If a stock dividend is large (more than 20-25%), the distribution should be referred to as a stock split.

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When a stock dividend is large, typically more than 20-25% of the existing shares, it is treated similarly to a stock split because it dilutes the share price and adjusts the number of shares outstanding in a way that is proportionate across all shareholders, akin to the effects of a stock split.

If a Stock Dividend Is Large (More Than 20-25%), the Distribution