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Splitsville: 5 Stocks Splitting This Autumn


Medivation, Magellan Midstream, and Plains All American have all announced stock splits for fall.

MINYANVILLE ORIGINAL At least five stock splits are scheduled for this autumn including Medivation (MDVN) and Magellan Midstream (MMP). The announced splits follow four that occurred in August including Coca-Cola (KO). At the rate the splits have occurred so far, 2012 looks like it will end up with roughly the same number of splits as 2011, which had 16. By comparison, 102 companies on the S&P 500 split their stock in 1997.

There are different perspectives on stock splits, but most view them as investor "rewards" -- even though in one way it's a non-event. Instead of have a $20 bill, you have two $10 bills after a 2-1 split, for example. However, that lower stock price can be an advantage and can seem more affordable to a wider range of retail investors. Generally the stock price change is reflected in the stock about three days after the split takes place. For an in-depth look at splits, see Justin Sharon's excellent Splits, Reverse Splits, and Why Apple and Google Are Not on the Dow.

Old Dominion Freight Line (ODFL) will split 3-2 payable on September 7. Old Dominion Freight Line is a less-than-truckload (or LTL) motor carrier in the US and has $2.57 billion in market capitalization. Old Dominion's stock at $44.94 is more than 10 times its price at the same time in 2002 when it was $3.20. In August, Old Dominion's director Leo H. Suggs invested $27,594,000 into 600 shares

LKQ Corp. (LKQ) will split 2-1 on September 18. LKQ and its subsidiaries provide replacement parts and components to repair vehicles in North and South America as well as the UK. This company has a market capitalization of $5.60 billion. LKQ's stock price at $37.66 is 10 times what it was in 2003 when it was $3.75. The split is LKQ's third since its shares began publicly trading in 2003.

Medivation will split 2-1 on September 21. Medivation is a biopharmaceutical company focusing on small molecule drugs. The FDA approved its prostate cancer drug, Xtandi, on Friday, August 31, three months ahead of the late-November deadline. Medivation has been rumored to be a takeover candidate. Its current market capitalization is $3.64 billion. Its stock price of $98.78 is 510% above its August 2011 price of $16.17.

Plains All American Pipeline (PAA) will split 2-1 on October 1. Plains All American transports and stores crude oil, refined products, and liquid petroleum gas products in the US and Canada and has a market capitalization of $14.11 billion. At $86.16, its stock price is 263% above the $23.72 it was valued at in September 2002. Since it derives the bulk of its income from pipelines, like competitor Magellan Midstream, the company is viewed as a "toll taker," and it is nearly immune to changes in the price of oil since the quantities still have to be moved from one place to another.

Magellan Midstream will split 2-1 on October 12. Magellan Midstream's pipelines transport a variety of petroleum products like its competitor, Plains All American. It has a market capitalization of $9.36 billion. Its stock prices of $82.86 is 258% over the $23.12 it was in September 2003. Like Plains All American, the company is a master limited partnership (or MLP), which is a special structure that allows firms to distribute the majority of its income to partner-shareholders in lieu of corporate taxes.
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