Please ensure Javascript is enabled for purposes of website accessibility

When Will Disney Split Its Stock Again?

By Rick Munarriz – Updated Aug 22, 2018 at 12:39PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The media giant's stock is approaching triple digits, making a stock split possible in the near future.

Editor's Note: This article was originally published March 7, 2016. It was updated Aug. 22, 2016, to reflect relevant changes.

Shares of Disney (DIS 3.36%) continue to trade at lofty heights. The stock is trading 12% higher since bottoming out earlier this year, and it's now a few upticks away from trading in the triple digits again. 

The family friendly media giant is in a good place, and with several catalysts in the works to improve its fundamentals, it's easy to see the stock moving higher. That's the kind of momentum that will lead the market to wonder when Disney will declare its next stock split.

A roller coaster blurred by speed exits a loop

Image source: Getty Images.

Disney stock is a consumer-facing juggernaut, and that's the kind of situation that makes it popular with individual investors. It's the most popular purchase on GiveAShare, a site where folks can gift a single share of a publicly traded company.

Disney stock as an investor fave makes the initial price point matter, and it's no surprise that Disney has split its stock in the past when it rolls north of $100. A stock split may be a zero-sum game -- 100 shares at $200 and 400 shares at $50 are the same thing -- but there's no denying that there's a psychological aspect to keeping a stock's price accessible.

It's at this point where it helps to assess how Disney has handled stock splits in the past. The House of Mouse has executed just six splits over the past 50 years, and it has waited until the stock is trading considerably higher than it is now.

Year Amount Pre-Split Price
1967 2-for-1 $105
1971 2-for-1 $177.75
1972 2-for-1 $214.50
1986 4-for-1 $142.63
1992 4-for-1 $152.87
1998 3-for-1 $111.00

Data source: Disney.   

All of Disney's stock splits have taken place with the shares in the triple digits. The average pre-split closing price is $150.63, but this doesn't mean that investors have to wait for the stock to soar 55% from here for its next stock split. The best guide would be Disney's most recent stock split, when Disney went with a 3-for-1 distribution in 1998 with the stock at $111. That would mean that Disney stock is now just 15% away from where it was when it executed its last stock split.

It will probably take more than that. Disney stock hit an all-time high of $122.08 last summer, and obviously it didn't push through a stock split at the time. However, between ambitious theme park expansion plans -- along with higher ticket prices, to boot -- and the juicy Marvel, Pixar, and Lucasfilm empires to mine, the stock will inevitably move to fresh all-time highs. The challenges at ESPN will continue and theme park attendance growth has been sluggish, but Disney has thrived even when it's not running on all cylinders. A fair bet is that Disney will go through with its first stock split in nearly 18 years the next time it's consistently trading above $120, and if the fundamentals keep improving, it may get there sooner than the market thinks.

Rick Munarriz owns shares of Walt Disney. The Motley Fool owns shares of and recommends Walt Disney. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Nearly 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Walt Disney Stock Quote
Walt Disney
$97.87 (3.36%) $3.18

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 11/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.