Walmart Announces 3-for-1 Stock Split to Make Shares More Affordable for Employees

Manoj Prasad

Walmart, a huge store chain, said Thursday that it will split its stock three times, giving owners two more shares for every share they already own on February 23, 2024. The split will happen on February 26th, when shares will start dealing with the new WMT ticker symbol based on how they were valued after the split.

Walmart will have about 8.1 billion shares out there after the split, three times as many as it has now (2.7 billion). The main reason for the change, according to the company, is to make it easy for employees to buy company stock.

Walmart has a scheme where employees can buy Walmart stock by having money taken out of their paychecks on a regular basis.

The company matches 15% of the first $1,800 that workers put into the plan each year. Walmart’s stock price is close to all-time highs above $160. The split will lower the price per share and make it easier for employees to buy.

“We want to provide our associates greater opportunities to become shareholders, so we’re pleased our board of directors has approved a stock split for February,” stated Walmart CEO Doug McMillon. “This will make our shares more affordable for our associates and long-term investors.”

The stock purchase program is used by about 400,000 Walmart workers. The split won’t change the market value of the company, which is currently $270 billion. However, it could lead to more trading by bringing smaller retail investors who find the lower nominal share price more appealing.

After a long period of price growth, companies often split their stocks to set the value of each share at a lower, more appealing level. The split doesn’t change the underlying value, but it can lead to more liquidity, smaller bid-ask spreads, and more attention from people.

Along with Amazon, Tesla, Apple, and Alphabet, Walmart is the latest big company to announce or carry out a stock split after a huge rally during the pandemic.

Walmart is still growing quickly; shares are up over 4% so far this year and are selling just below their all-time high from November. This is happening at the same time as the stock split.

Walmart is going to report its earnings for the fourth quarter and the whole fiscal year of 2023 on February 21, which will give us more information about how well the retail giant did.

After two very successful years, Walmart is going to reward shareholders and workers in another way with the upcoming stock split.

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