Stock-Split Watch: Is D-Wave Quantum Next?

Companies tend to use stock splits for a few different reasons. Traditional stock splits artificially lower a company's share price while increasing the amount of shares outstanding, without changing the market cap or equity value of a stock. Reverse stock splits do the opposite. While difficult to predict, companies will typically pull the trigger on a stock split after a stock has made a big move in one direction or the other.One stock that has been volatile and made quite a few big moves is D-Wave Quantum (NYSE: QBTS), one of the few pure-play quantum computing companies. D-Wave is not only trying to build advanced quantum computers, but also trying to commercialize them. Could D-Wave Quantum soon execute a stock split?Let's quickly do an example of a stock split to illustrate how it works. Let's say a person buys 60 shares of a stock trading at $800 per share for a total equity position of $48,000. If the company then conducts a 6-for-1 stock split, the person would exchange one share for six new shares of the company, bringing their total share count to 360 shares. Remember, the market cap doesn't change, so the share price would decline to $133.33 ($48,000/360 shares).Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool