When Is the GameStop Stock Split Date? What Will Happen to GME Stock?

GameStop (NYSE:GME) stock shot as much as 16.9% higher in after-hours trading after the company announced plans to split its stock. So when is the GameStop stock split date? And what will happen to GME stock once the split goes into effect?

Retailers walk past a GameStop (GME stock) store in New York City, New York.
Source: Northfoto / Shutterstock.com

Today, investors learned this big news via a U.S. Securities and Exchange Commission filing. GameStop will follow in the footsteps of tech giants like Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN) in splitting its stock. Tesla (NASDAQ:TSLA) also recently announced it intends to seek shareholder approval for a stock split.

According to the filing, GameStop plans to seek shareholder approval to increase the amount of authorized Class A common stock from 300 million shares to 1 billion shares. It says that increasing the share count will allow it to enact a stock split in the form of a dividend payout. The company also said that it could use this share count increase to “provide flexibility for future corporate needs.”

As CNBC reported, this could mean that GameStop plans to sell more stock, among other things.

When Is the GameStop Stock Split Date?

GameStop announced its plans for a stock split on March 31, 2022. Before the split can take effect, shareholders must vote to approve the proposal. This vote is set to take place during the upcoming annual meeting. The company has not yet announced the date and location for the annual meeting. GameStop also said the stock dividend must receive approval from its board of directors.

For shareholders and meme stocks fans, there are unfortunately few details available at this time. However, GameStop said it will share more in the proxy statement that it issues ahead of the annual meeting.

What Will Happen to GME Stock?

Investors appear to like the news, sending GME stock up in after-hours trading. This could be due to speculation that meme stocks fans will be piling into GameStop in coming days.

More broadly, investors tend to view stock splits as a way to make shares more accessible. By lowering the overall price of one share, new investors may be able to buy in. This has led companies like Alphabet and Amazon with high-priced shares to enact splits and widen their shareholder bases. GME shares are currently trading for more than $190 after the latest rally. Over the last two years, this share price has increased by more than 5,000%.

Therefore, enacting a stock split and lowering the individual share price could entice more fans to become shareholders.

However, investors should note that beyond changing the share price, a stock split will not have any other fundamental impacts on GameStop stock.

On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Article printed from InvestorPlace Media, https://investorplace.com/2022/03/when-is-the-gamestop-stock-split-date-what-will-happen-to-gme-stock/.

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