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When a company announces that it will split its stock, in the form of a stock dividend, what does this mean? I ask because it is stated in releases as if it is different from a basic 2 shares for each 1 share owned (as an example). Maybe it's just terminology but clarification would be appreciated. Thanks.
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brotherdev,

<<<When a company announces that it will split its stock, in the form of a stock dividend, what does this mean? I ask because it is stated in releases as if it is different from a basic 2 shares for each 1 share owned (as an example). Maybe it's just terminology but clarification would be appreciated. Thanks. >>>

It is just terminology. A stock dividend is a stock split. You would retain the original purchase date for all shares and adjust your cost basis across the shares.

TMF Dawn
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brotherdev,

<<<When a company announces that it will split its stock, in the form of a stock dividend, what does this mean? I ask because it is stated in releases as if it is different from a basic 2 shares for each 1 share owned (as an example). Maybe it's just terminology but clarification would be appreciated. Thanks. >>>

It is just terminology. A stock dividend is a stock split. You would retain the original purchase date for all shares and adjust your cost basis across the shares.

TMF Dawn


Hot Topic just announced a stock divident for 2 to 3, which would means that I'm getting more stocks, but the value remains the same? So there is not true Stock divident, where you get more stocks and the value of the holding increase?

I feel like I just learned there's no Santa Claus.....
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