“The reason for the split is it makes our shares more accessible,” Ruth Porat, Alphabet’s chief financial officer, said in a conference call with television anchors. “We thought it made sense to do.”
Alphabet Inc. is bringing big stock splits back to the market, so prospective buyers won’t need upwards of US$3,000 ($4,049.07) to own a share. Taking down the price achieves something else for the Google parent: making it possible to put America’s third-biggest company into its most venerated stock average.
The company said late Tuesday it will increase its outstanding shares by a 20-to-1 ratio, aiming to entice the numerous small investors who have flocked to the stock market during the pandemic. The shares jumped 10% in US premarket trading on Wednesday, and were set to surpass their record high reached last November.
