Microsoft Stock Split History: A Guide to Dividend Payouts and Growth
Introduction
Microsoft Corporation (MSFT) has a long history of stock splits, which have significantly increased the number of shares outstanding and affected the company's dividend payouts and overall growth.
Stock Split History
Microsoft has undergone a total of 9 stock splits since 1987, with the most recent occurring on February 18th, 2003. The following table summarizes the key details of each split:
| Date | Split Ratio |
|---|---|
| September 21, 1987 | 2-for-1 |
| January 23, 1990 | 2-for-1 |
| January 13, 1992 | 2-for-1 |
| July 14, 1997 | 2-for-1 |
| January 18, 1999 | 2-for-1 |
| April 19, 2000 | 2-for-1 |
| January 22, 2002 | 2-for-1 |
| February 18, 2003 | 2-for-1 |
| February 18, 2003 | 2-for-1 |
Impact on Dividend Payouts
Stock splits do not affect the total value of a company's shares or its dividend payments. However, they do increase the number of shares outstanding, which can lead to a decrease in the per-share dividend amount.
In Microsoft's case, the dividend per share has remained relatively stable over the past decade, despite the multiple stock splits. This is because the company has consistently increased the total amount of dividends it pays out, offsetting the effect of the stock splits.
Impact on Share Price and Market Capitalization
Stock splits can have a positive impact on a company's share price and market capitalization. By increasing the number of shares available, stock splits make the stock more affordable for investors, which can lead to increased demand and higher prices.
Microsoft's stock price has generally trended upwards over the past three decades, and the company's market capitalization has grown significantly. The stock splits have contributed to this growth by making the stock more accessible to a wider range of investors.
Conclusion
Microsoft's stock split history has been an important factor in the company's growth and success over the past three decades. The splits have increased the number of shares outstanding, making the stock more affordable for investors and contributing to the company's rising share price and market capitalization.
Despite the stock splits, Microsoft has maintained a consistent dividend payout policy, which has also contributed to its attractiveness to investors.
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