Google (Nasdaq: GOOG) Stock News: Split Update and Long-Term Outlook

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Ahead of the Google Inc. (Nasdaq: GOOG) stock split that will take place on April 2, Standard & Poor's announced yesterday (Tuesday) that it will keep two classes of the company's stock in its indexes.

Google stock splitThat's a change from how the index has handled such cases in the past, when Standard & Poor's would only allow a company to be represented once on its indexes.

After the Google stock split, the S&P 500 will actually have 501 stocks. The index will still be represented by 500 companies, however.

Standard & Poor's had said previously that it would drop one of GOOG's share classes on June 20, bringing the S&P 500 back to 500 stocks.

Google first proposed the idea of the two-for-one stock split in 2012. The split will double the number of shares the company has outstanding and will halve the price of the stock.

Furthermore, the move will ensure that Google founders Sergey Brin and Larry Page are able to maintain close control over the company.

When the stock splits on April 2, shareholders will be given a "Class C" share for each Class A or B share they own. Importantly, Class C shareholders will have no voting rights – that's how the split helps keep control in the hands of Brin and Page.

With Google's stock split less than a month away, here's what investors need to know about GOOG stock moving forward…

Google (Nasdaq: GOOG) Stock's Long-Term Value

Today, Google stock opened just below $1,200 per share. Current shareholders can expect to own two stocks valued around $600 each on April 2, barring any unforeseen movement in either direction for GOOG stock.

Google -C-
NASDAQ: GOOG
Oct 22
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Price: 532.71 | Ch: 6.17 (1.2%)

For investors looking to buy GOOG stock but previously put off by the hefty price tag, the split offers a more affordable entry point.

Year to date, GOOG is up 7%, compared to a loss of 1.5% for the Dow Jones Industrial Average and a 2% gain for the S&P 500. In the last 12 months, GOOG is up 45%.

In January, JPMorgan Chase & Co. (NYSE: JPM) Analyst Doug Anmuth raised his price target on GOOG stock to $1,325. At the time, he stated that Class A shares could see a spike in demand among indices as they shuffle to accommodate Google's split.

But what does the long-term future hold for GOOG stock and Google shareholders?

Join the conversation. Click here to jump to comments…

  1. Helen R | March 16, 2014

    I am a novice and have never invested in shares before, but would like to get involved. How and who would I have to contact? You say brokers are not the best way to go. Could I invest directly on the stock market without a broker? How do I go about this? Hope you can help me. Thank you for reading this.
    Regards,
    Helen

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