Stock Split Calculator

Current Number of Shares:

Current Share Price ($):

Split Ratio (New Shares – e.g., '2' for 2-for-1):

Split Ratio (Old Shares – e.g., '1' for 2-for-1):

Calculation Results:

Total Value Before Split:

New Number of Shares:

New Share Price:

Total Value After Split:

function calculateStockSplit() { var currentShares = parseFloat(document.getElementById('currentShares').value); var currentSharePrice = parseFloat(document.getElementById('currentSharePrice').value); var splitNewShares = parseFloat(document.getElementById('splitNewShares').value); var splitOldShares = parseFloat(document.getElementById('splitOldShares').value); if (isNaN(currentShares) || isNaN(currentSharePrice) || isNaN(splitNewShares) || isNaN(splitOldShares) || currentShares <= 0 || currentSharePrice <= 0 || splitNewShares <= 0 || splitOldShares <= 0) { document.getElementById('stockSplitResult').innerHTML = '

Calculation Results:

Please enter valid positive numbers for all fields.'; return; } var totalValueBeforeSplit = currentShares * currentSharePrice; var splitFactor = splitNewShares / splitOldShares; var newNumberOfShares = currentShares * splitFactor; var newSharePrice = currentSharePrice / splitFactor; var totalValueAfterSplit = newNumberOfShares * newSharePrice; // Should be equal to totalValueBeforeSplit document.getElementById('resultTotalValueBefore').innerHTML = 'Total Value Before Split: $' + totalValueBeforeSplit.toFixed(2); document.getElementById('resultNewShares').innerHTML = 'New Number of Shares: ' + newNumberOfShares.toFixed(2); document.getElementById('resultNewSharePrice').innerHTML = 'New Share Price: $' + newSharePrice.toFixed(2); document.getElementById('resultTotalValueAfter').innerHTML = 'Total Value After Split: $' + totalValueAfterSplit.toFixed(2); } // Initial calculation on page load window.onload = calculateStockSplit;

Understanding the Stock Split Calculator

A stock split is a corporate action that increases the number of a company's outstanding shares by dividing each existing share into multiple shares. While the number of shares increases, the total market value of the company remains the same, and consequently, the value of an investor's total holdings also remains unchanged. The price per share, however, decreases proportionally.

How Does a Stock Split Work?

When a company announces a stock split, it specifies a ratio, such as 2-for-1, 3-for-1, or even 3-for-2. Let's break down what these ratios mean:

2-for-1 Split: For every one share you owned before the split, you now own two shares. If the stock was trading at $100 per share, it would now trade at $50 per share. Your total investment value remains the same.
3-for-1 Split: For every one share you owned, you now own three shares. A $150 stock would become $50 per share.
3-for-2 Split: For every two shares you owned, you now own three shares. If you owned 100 shares at $150 each, you would now own 150 shares at $100 each.

Why Do Companies Split Their Stock?

Companies typically initiate stock splits for several reasons:

Increase Liquidity: By lowering the share price, more investors can afford to buy shares, which can increase trading volume and make the stock more liquid.
Make Shares More Accessible: A high share price can deter smaller retail investors. A split makes the stock appear more affordable and accessible to a broader range of investors.
Psychological Effect: A lower share price can create a perception of value, even though the underlying fundamentals of the company haven't changed.
Attract New Investors: Companies might aim to keep their stock price within a certain range that is attractive to a wider investor base.

Impact on Investors

For an existing investor, a stock split does not change the fundamental value of their investment. You own more shares, but each share is worth less, balancing out the total value. For example, if you owned 100 shares of a company trading at $200 per share (total value $20,000) and the company announced a 2-for-1 split, you would then own 200 shares, each trading at $100, still totaling $20,000.

Dividends per share are also typically adjusted proportionally. If a company paid a $1.00 dividend per share before a 2-for-1 split, it would likely pay $0.50 per share after the split, maintaining the same total dividend payout for the investor.

Using the Stock Split Calculator

Our Stock Split Calculator helps you quickly understand the impact of a stock split on your holdings. Simply input:

Current Number of Shares: The total number of shares you currently own.
Current Share Price: The market price of one share before the split.
Split Ratio (New Shares): The first number in the split ratio (e.g., '2' for a 2-for-1 split).
Split Ratio (Old Shares): The second number in the split ratio (e.g., '1' for a 2-for-1 split).

The calculator will then instantly show you your total investment value before the split, the new number of shares you will own, the new price per share, and your total investment value after the split, confirming that your overall wealth remains unchanged.

Example Calculation:

Let's say you own 50 shares of Company X, and the current share price is $300. Company X announces a 3-for-1 stock split.

Current Number of Shares: 50
Current Share Price: $300
Split Ratio (New Shares): 3
Split Ratio (Old Shares): 1

Using the calculator, you would find:

Total Value Before Split: 50 shares * $300/share = $15,000
New Number of Shares: 50 shares * (3/1) = 150 shares
New Share Price: $300 / (3/1) = $100/share
Total Value After Split: 150 shares * $100/share = $15,000

As you can see, your total investment value remains the same, but you now own more shares at a lower price per share.