Stock splits don't change fundamentals or company value; they do a lot for investors, ultimately driving equity gains. At face value, a stock split signals underlying company strength: the stock is trending higher at “unreasonably” high price levels and is expected to continue rising, as only fundamentally strong companies can.
Digging deeper, stock splits increase affordability, even if only psychologically, opening shares to a wider audience, specifically retail traders, who drive a lot of the day-to-day price action. Most importantly, stocks that split signal managerial confidence in future results and tend to keep trending higher because the fundamental drivers remain intact.
