Costco's Stock Split: What Investors Need to Know

A Look Back at Costco's Stock Split History

Costco Wholesale Corporation (COST) has a long history of stock splits, with the most recent one occurring in 2015. Since 1986, the company has split its shares a total of five times. The following table shows the dates and ratios of each split:

Date	Ratio
1986	2-for-1
1990	2-for-1
1993	3-for-2
1999	2-for-1
2015	3-for-2

Why Companies Split Their Stocks

There are several reasons why companies may choose to split their stock. One reason is to make the stock more affordable for individual investors. When a stock's price becomes too high, it can become difficult for some investors to purchase shares. A stock split lowers the price per share, making it more accessible to a wider range of investors.

Another reason companies may split their stock is to increase liquidity. A stock split can increase the number of shares available for trading, which can make the stock more attractive to institutional investors. Increased liquidity can also lead to a higher stock price.

What a Stock Split Means for Investors

When a company splits its stock, the number of shares that you own will increase, but the total value of your investment will remain the same. For example, if you own 100 shares of a stock that is trading at $100 per share, and the company splits its stock 2-for-1, you will now own 200 shares of the stock, but each share will be worth $50. The total value of your investment will still be $10,000.

Stock splits can be a positive sign for investors, as they can indicate that the company is doing well and is confident in its future prospects. However, it is important to remember that stock splits do not always lead to higher stock prices. The long-term performance of a stock is determined by a variety of factors, including the company's financial performance, the overall economy, and market sentiment.