The value of a stock split is exactly zero, offering a visual change rather than a fundamental shift, which appeals to investors' bullish sentiments.
In 2024, several companies including Broadcom and Nvidia executed high-profile stock splits, signaling a wave of investor interest despite the unchanged fundamentals.
Despite Chipotle's significant stock split making its shares appear cheaper, the intrinsic value remains the same, illustrating the non-impact of splits on business fundamentals.
Investors are drawn to stock splits as they often reflect a company's optimistic outlook, encouraging purchases before or after the split.
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