Artificial intelligence (AI) has dominated Wall Street for over two years, significantly impacting growth across various industries. A close second in investor interest is stock-split activity, which adjust share prices and outstanding share counts without altering a company’s market cap. Bank of America Global Research reports that companies executing forward stock splits have averaged a 25.4% return in the year following the announcement, outpacing the S&P 500’s average return of 11.9%.
As of June 22, Berkshire Hathaway’s Class A shares (NYSE: BRK.A) have never split, with a share costing approximately $730,000. In contrast, the Class B shares (NYSE: BRK.B) underwent a 50-for-1 split in January 2010. With CEO Warren Buffett set to retire by the end of the year, the question arises whether the company will initiate a stock split. However, future CEO Greg Abel is expected to maintain the company’s long-standing practices, including retaining a high share price to promote long-term investment strategies.
Despite speculation, analysts predict Berkshire Hathaway will not conduct a stock split post-Buffett, especially as Abel has the company sitting on a record $347.7 billion in cash equivalents, eliminating the need for splits to facilitate acquisitions.
