GameStop will complete its4-for-1 stock splitthis week after a months-long process.
The new shares will be issued to shareholders of record at market close on Thursday, July 21.
The cutoff date to be a shareholder of record is market close on Monday, July 18.
This means you might still buy shares until 4 p.m.
ET today and receive new shares Thursday.
Trading will continue at the split-adjusted price when the market opens on Friday, July 22.
GameStop was trading at roughly $145 Monday morning.
If the stock split occurred around that price, the split-adjusted price would be roughly $36.
Below, we lay out what this means for you as a shareholder.
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So, what’s a stock split?
A stock split essentially makes the stock more accessible and flexible.
Stock splits can come in any ratio – some common split ratios include 3-for-1, 5-for-1 and 20-for-1.
After that, the board of directors of the company can vote on whether to issue a stock split.
The split also provides more financial flexibility for the company.
Note that a stock split isn’t the same thing as a stock offering.
In a stock split, the issuing company doesn’t raise any capital for its own use.
How does a split affect the stock price?
In short – pun intended – anything can happen to share prices in the stock market short-term.
With a super volatile stock like GME, the split may create some interesting price action.
What happens to my GME options during a split?
Options are affected the same way shares are if they expire beyond the official day of the split.
This gives theholdermore flexibility with strategy: you could now mix and match whether you sell or exercise them.
What’s next for GameStop?
The SEC filing denotes that the stock split is intended to provide “flexibility for future corporate needs.”
