info : stock splits
You may ask yourself why do we cover stock splits. Stock splits add no value and only increase the number of shares by two, three or whatever the declared ratio may be.
However there are several good reasons we cover stock splits. The first and foremost reason is it provides a record of the stock split in our runnning type display of company earnings. Another reason we pay attention to stock splits is that past market leaders usually have had a series of stock splits during their greatest growth periods. True, some companies have stock splits to help buoy their stock price or merely to increase their liquidity. But it can be a tip-off to a potential up an coming market leader. The market leaders generally will have had several successive quarters of explosive earnings and sales growth. Be sure to look for that in our earnings coverage.
If you are truly interested in investing in stock splits there are several things to keep in mind. As was said earlier, look for companies that are having strong earnings and sales growth combined with a rising earnings and strength rank. We also think that the stock should have an average trading volume of at least 50,000 shares a day. However, there are people that like trading in low volume stocks which we do include in our coverage. Another thing to keep in mind is the current market direction. Most stocks move with the markets and lately the makets have been moving together. If the markets are headed up, a lot of stocks are headed up and a stock split could be perceived as a good thing. If the markets are headed down, well like I said earlier most stocks follow the markets. Finally, look for companies that have a good story with new products, new technology, new management, new regional growth or anything that spells more sales and more earnings.
Another tool that investors should consider is using technical analysis along with the fundamentals to identify trends and determine the best time to move into and out of stock positions. If you don't know anything about technical analysis we reccomend you get a few books on the subject to learn with. You should have at least one book on hand for ready reference.
Trading stock splits can work for investors that pay attention to the details. An explanation of the stock split table follows:
announced - This is the date the stock split was announced.
symbol - This is the ticker symbol that a stock is identified by. We cover only stocks listed on the NYSE, NASDAQ and AMEX markets.
list price - This is the closing price on the day the stock split was announced.
rt - This stands for record type and should only show "SS" on this table. Like elsewhere, the link in the "rt" column will go to the stock split detail table.
group - Group, as in industry group is basically what the company is engaged in. There is a list located in "abbreviations". It may seem confusing at first, but you will soon learn what they mean and the abbreviation is much smaller and easier to use in the tables.
ratio - This is the split ratio. When you see 3:2, you can read it as "3 for 2".
opt - This states whether the stock is optionable. A "Y" means yes.
er - This stands for "earnings rank" and is a number from 0 through 10 with 10 being the best. This number is based entirely on our opinion and is not the result of some secret formula and should be treated as just that, an opinion.
sr - This stands for "strength rank" and like "er" is a number from 0 through 10 with 10 being best. This number is also based entirely on our opinion of how the stock has performed.
avg vol - This stands for average volume and is meant to be a 3 month average volume when available. We take the number and then reduce it to the next lowest thousand except when the average volume is below 10,000. We then use the actual number. So an average volume of 159,999 would be 159,000 and 9,999 would stay 9,999. When you find an "e" after the number (159,000e) the number is an estimate and is actually a number from an adjacent quarter.
payable - This is the "payable date" and is the trading day prior to trading at the adjusted share price.
Please note that all table headers have titles that can be accessed by hovering the curser over the header name in most current browsers.