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Apple Might Split Stock: Bernstein Research (AAPL)

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According to Bernstein Research, a research firm, tech giant Apple Inc. (NASDAQ:AAPL) might well be mulling over splitting its stock. Apparently, the company wants to register itself at Dow Jones Industrial Average Index-which is price based; and, a stock split will allow Apple to become a Dow Component as stock  price will get halved even as number of shares will increase twofold.

Dow Jones – a 30 company Index, at present, is underrepresented by technology companies.

Currently, there are only five technology based companies included as Dow Jones Components: International Business Machines (NYSE:IBM), Hewlett-Packard (NYSE:HPQ), Microsoft (NASDAQ:MFST), Intel Corp.(NASDAQ:INTC) and Cisco Systems (NASDAQ:CSCO).

Only two companies included in the index trade above $100 a share; Chevron Corp. (NYSE:CVX) and IBM.

Toni Sacconaghi, a research analyst at Bernstein Research, wrote in his research note that a stock split will offer multiple benefits to Apple. Firstly, it will provide a larger investors base and will reduce option issuance.

The company has split its stock on three occasions before. The first split was done in June 1987, second in June 2000 and the third one in February 2005. On all the three occasions, the split was 2-for-1.

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