GE shares soar, trade above $100 after reverse split takes effect

For General Electric Co. GE,
Investors who may have taken a double take when they saw their shares trade above $100, the reason being that the 1-for-8 reverse stock split the industrial conglomerate proposed earlier this year just took effect. The stock rose 2.1% to $105.80 in morning trading, which represents a pre-split adjusted price of about $13.23. The stock’s new split-adjusted record close is August 28, 2000, $461.40. GE had said in March that it wanted to implement the reverse split, which is typically done by companies looking to increase their share price to avoid being delisted or to make it more attractive to certain institutional investors, because the company “is the number of shares outstanding to a number more typical of companies with a similar market capitalization.” GE’s current market cap is approximately $116.1 billion. As of June 30, GE had 8.78 billion shares outstanding; the reverse split multiplies the stock price by eight, but also divides the outstanding shares by eight, to reduce it to approximately 1.10 billion shares. For comparison: fellow S&P 500 SPX,
parts 3M Co. mmm,
with a market cap of $115.4 billion, 578.6 million shares outstanding as of June 30, and Caterpillar Inc. cat,
with a market cap of $114.8 billion, it had 547.8 million shares outstanding as of March 31, according to their latest 10-Q filings.