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faux saint laurent bag was founded with the intention of helping people worldwide discover their unique heritage Some big changes are coming up for Amazon shareholders and employees. Amazon recently announced a stock split, share buyback program, and a compensation increase. The changes are expected to take place in early June 2022.
A 20-to-1 stock split
A $10 billion dollar share buyback program
An increase in maximum base salary compensation from $160,000 to $350,000
AMZN Stock Split
With Amazon's stock split, the value of one current share will be split into 20 shares. Imagine having one large, delicious cheese pizza, and then cutting it into twenty slices. You will own the exact same pizza, but instead of one whole pie, you own twenty smaller pieces. The value of a share of Amazon stock will be divided by twenty, so while you will have 20x more shares, each share will be worth 20x less.
Amazon Share Buyback Program
Amazon is also implementing a share buyback program. Amazon is a company worth -$1.1 trillion. Buying back $10 billion of stock is akin to Amazon buying back -0.91% of the company. Share buybacks are a tax efficient method to bring value to shareholders compared to dividends, which when paid out are a taxable event in taxable investment accounts. Stock buybacks in big tech are not unusual, with Apple and Microsoft both also having also implemented stock buyback programs.
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