Monaco Coach Corp. stock declined $3.05 a share, or 11%, in New York Stock Exchange trading today (Aug. 7) following the company’s announcement of a 3-for-2 stock split.
Monaco stock closed at $25.70 today.
A sharp fall-off in Monaco’s stock price was expected because the stock split will increase the number of outstanding Monaco shares to 28.5 million, from 19 million. Consequently, each share will represent a smaller piece of the company.
The new shares will be distributed in the form of a stock dividend on Sept. 7 to shareholders of record as of Aug. 20.
Monaco stock reached its current 52-week high of $33.20 a share in early July. The company’s board decided to engage in a stock split to keep Monaco stock affordably priced so more investors could afford to buy it, which would increase the value of investments in Monaco stock over the long-term, according to Kay Toolson, chairman and CEO.