Amazon (NASDAQ:AMZN) stock will undergo a 20-for-1 split after the stock market closes today. As a result of the split, the number of shares of the stock will be multiplied by 20, and the price of the shares will be divided by roughly 20 from its current level.
The change will likely make the e-commerce giant’s stock more appealing to retail investors. This is because they will be able to afford to buy more of the company’s shares.
Amazon announced on March 9 that the split would occur. Partly due to anticipation of the day, AMZN stock has climbed 8% in the last month.
AMZN Stock Follows in the Footsteps of Other Big Tech Companies
With the split, Amazon is following in the footsteps of other major tech companies. Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and Tesla (NASDAQ:TSLA) have all made similar moves in the past. Those giants’ stocks also responded positively to their splits.
On March 9, Amazon also announced that its board authorized a buyback of as much as $10 billion of AMZN stock.
Despite the recent rally, AMZN shares have still tumbled 25% so far this year. Nevertheless, in a May 28 note to investors, Loop Capital Markets analyst Rob Sanderson predicted that the name “could … double in price if unit economics recover as expected by 2025.”
On the date of publication, Larry Ramer 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.
