Late Thursday athletic equipment manufacturer Nike, Inc. (NKE) announced a 2-for-1 stock split to take place on December 24. The company also announced a rise in its quarterly dividend.
The stock split will take place on December 24 and the company expects the common stock to start trading at split-adjusted price on December 26. Both classes of Nike stock, Class A and the widely traded Class B, will be effected.
Company’s will split its stock when it feels that the price of a share has gotten too expensive or too high compared to similar competitors. The value of a shareholder’s stake will stay the same; the difference is that the shareholder will known own more stock at a lower price.
On a post-split adjusted basis, Nike is increasing its quarterly dividend 3 cents, or +17%, to 21 cents per share. The ex-dividend date for this next payout is December 6, with the pay date being December 26. This is the eleventh consecutive year that the company has increased its dividend.
Nike shares were up $1.51, or +1.66%, in premarket trading on Friday.
The Bottom Line
Shares of Nike Inc. (NKE) will now have a 1.85% dividend yield, based on the higher dividend payout and last night’s closing stock price of $90.83. The stock has technical support in the $80-$85 price area. If the stock can firm up, we see overhead resistance around the $95-$96 price levels.
Nike, Inc. (NKE) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.