Apple’s decision to split its shares was made to help make it more accessible to investors, CNBC spokesman Jim Cramer said Friday, citing a conversation he had with its CEO Tim Cook.
“I think Apple is taking the right step. Tim told me yesterday, ‘Hey, I want more people in stock,'” Cramer told Squawk Box. “These other companies should do the same.”
The iPhone maker, which saw sales up 11% in the last quarter, also announced Thursday it will split shares “for one”; at the end of August.
Apple shareholders will receive three additional shares when the business closes on August 24th. Apple traded around $ 407 on Friday morning, which means investors will be able to buy shares for about $ 102 when the shares start trading at an allotted size. 31.
Apple has done this several times in the past, most recently in 2014, when it shared stocks with the Seven. Apple then traded north of $ 600 a share.
The split does not change the company’s fundamentals, Cramer explained on Squawk Street. But Cramer said it could make the stock more attractive to retail investors, who may avoid investing in the company because of the high price tag – a type of sticker shock to stocks.
“The idea that he wants more people in his warehouse is fresh,” said Cramer of Apple Cook. “He doesn’t play for hedge funds. He plays for people who buy a product and have a 99% satisfaction rating. That’s what he plays with.”
The developer of Mad Money said other companies don’t seem to place as much emphasis on the availability of retail investors as Amazon. El. The trading and cloud giant traded about $ 3,200 per share, based on a pre-trade stock movement.
“Apple cares about the little guy.” Amazon isn’t focusing on that. They’re focusing on getting goods for the little guy, ”Cramer said.
Disclosure: Cramer Charity Fund owns shares in Apple and Amazon.