Stock Splits - A sign of the times.
In the late 19th and early 20th centuries, many states taxed corporations based on the par value of their shares.
For example, take ExxonMobil as an example. In 1931, their shares carried a par value of $25 per share.
To get around this, companies began using stock splits as well as stock dividends, which increased the number of shares and reduced the par value of said shares.
By the mid-20th century, taxation based on par value became antiquated, and many states moved away from this.
For reference, XOM and many other corporations now have shares with zero par value associated with them.
Today, stock splits serve another purpose: to broaden the investor base and make shares more appealing to those who judge equities as they judge the price of eggs at the grocery store—simply by the price on the screen.
What am I getting at?
We sit here and watch the tech sector split their shares year by year:
Apple with a 4:1 split in 2020
Tesla twice, with a 5:1 split in mid-2020 and a 3:1 split in mid-2022
Google in 2022 with a 20:1 split
Amazon with a 20:1 split in 2022
And finally, the mac daddy of them all, NVIDIA (NVDA), with a 10:1 split last week
Having spent years digging through old annual reports and WSJ stock tables that can only be found on microfiche, I noticed something: Oil & Gas companies all tended to split their shares around the same time near the peak of the cycle, as shown in the chart below.
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