Walmart (WMT) investors are preparing for a stock split later today.
For the 12th time in 50 years, Walmart will conduct an after-hours stock split to make shares more affordable for its employees, Brooke DiPalma, senior reporter at Yahoo Finance, reported. The shares will begin trading on a post-split basis from February 26th.
Walmart last completed a 2-for-1 stock split on April 20, 1999. This time it will be the company's first stock split at a ratio of 1:3.
This comes amid a series of employee-friendly initiatives from the world's largest retailer this year. Others include offering store manager stock grants of up to $20,000 and higher base pay.
I assure you this is not standard retail practice. However, they should address increasing demands on store employees, such as running through huge aisles to process online orders.
Here's what Walmart CFO John David Rainey told me on Yahoo Finance Live this week when I asked if there was a cultural reset happening within the company:
“You could call it that. That's an interesting characterization. I think fundamentally we want to continue to invest in our people. Fortunately, as a company, we currently have the margin profile that we can do.” Do this, invest in our people, but also see our operating income grow faster over time.
“I think a consistent theme in my two and a half decades of work is that getting the operators of our company, the front line, to behave like owners is also a very good thing for shareholders. We are very pleased to enable our branch managers to participate through share ownership through the share allocation.”
What's good for employees could be good for a company's stock price. makes sense!
Stock splits have generally worked out well for Walmart. (Yahoo Finance)