Lockheed Martin Stock Split: History Suggests Wait for LMT

Lockheed Martin ($LMT+WL) shares are currently trading just below the $600 mark, despite hitting several all-time highs this year. This performance has led some investors to consider the possibility of a stock split. However, historical analysis suggests that a stock split is not imminent. Lockheed Martin last executed a stock split in 1999, a 2-for-1 event.

Further, companies with share prices exceeding $1,000, such as Micron Technology (MU), have not recently split their stock, indicating that even higher price levels may be necessary before Lockheed Martin's management considers such a move. The decision to split remains solely with the management team, with no guarantee of an occurrence.

Historically, stock splits can attract short-term investors seeking to capitalize on increased attention, potentially leading to a temporary boost. Data from Bank of America indicates that companies experience an average total return of 25.4% in the 12 months following a split announcement, outperforming the S&P 500. However, this influx of short-term buyers can also introduce volatility. Management is typically not incentivized to split shares as long as there is healthy demand. Investors are advised to focus on Lockheed Martin's long-term investment potential over the timing of a stock split.