Apple’s decision to split its stock was made to help make it more accessible to investors, CNBC’s Jim Cramer said Friday, referring to a conversation he had with its CEO, Tim Cook.
“I think Apple is taking the right move. Tim told me last night, ‘Hey, I want more people in stock,'” Cramer said on “Squawk Box.” “These other companies have to do that as well.”
The iPhone maker, which reported an 11% increase in sales in its last quarter, also announced that on Thursday it will make stock for four for a split at the end of August.
Apple shareholders will receive three additional shares at the close of business on August 24th. Apple was trading around $ 407 on Friday morning, meaning investors will be able to buy shares around $ 102 when the stock begins trading on a split-adjusted basis in August. .31.
Apple has done this several times in the past as well, most recently in 2014 when it split the stock from seven to one. Apple was then trading north of $ 600 per share.
A share split does not change a company’s fundamentals, Cramer explained on “Squawk on the Road.” But Cramer said it could make a stock more attractive to sales-level investors who could escape from investing in a company because of a high price – a kind of sticker similar to equities.
“The idea that he wants more people in his storage is refreshing,” Cramer said of Apple’s Cook. “He doesn’t play with hedge funds. He plays with people who buy the product and have a 99% satisfaction rating. That’s what he plays.”
Host “Mad Money” said other companies don’t seem to have as much emphasis on accessibility for retail investors, such as Amazon. The e-commerce giant and partner was trading around $ 3,200 per share, based on a move in the premarket.
“Apple cares small. Amazon isn’t focused on that. They’re focused on getting the merchandise to the small type,” Cramer said.
Disclosure: Cramer’s charitable trust owns shares of Apple and Amazon.