GBH Inc. is planning on announcing a 5-for-2 stock split. The stock is currently trading at $90 per share. Based on this information, what will be the new stock price?

Question

Quizplus · Accepted Answer

In a 5-for-2 stock split, for every 2 shares an investor holds, they will receive 5 shares in total after the split. This increases the number of shares and decreases the price per share. To find the new price, divide the old price by the ratio of the split (5/2). $90 divided by (5/2) equals $36.00.

GBH Inc Is Planning on Announcing a 5-For-2 Stock Split