Over the past three years, no innovation has captivated the attention of investors quite like the rise of artificial intelligence (AI). However, this is far from the only trend that’s helped lift Wall Street’s major stock indexes to new heights.
Enthusiasm surrounding stock splits in some of the market’s most-influential businesses is another catalyst responsible for boosting equity valuations.
A stock split is an event that allows a publicly traded company to cosmetically adjust its share price and outstanding share count by the same magnitude. These changes are entirely surface-scratching in the sense that they don’t affect a company’s market cap or in any way influence its underlying operating performance.