GameStop stocks climb as video game retailer looks to split shares

Shares in the high street computer store and other so-called 'meme' stocks are seeing renewed interest from retail investors

Shares of GameStop have nearly doubled in value in the past two weeks.

Shares of GameStop jumped after the video game retailer at the heart of last year's retail trading frenzy said it would seek shareholder approval for a stock split.

The plan comes as shares of GameStop and other so-called "meme" stocks including AMC Entertainment are seeing renewed interest from retail investors, who are piling into riskier assets emboldened by hopes of a resolution in Russia's conflict with Ukraine.

Shares of GameStop, which have nearly doubled in value in the past two weeks, rose 10% at one stage on bets that a stock split, which makes shares of a company more affordable, would boost the value of the retailer by attracting more retail traders.

Stock splits

Stock splits are becoming more common as companies look to manage "their stock price in what is considered an investor-friendly range", said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

In the past two years, Apple, Nvidia, and Tesla have split their shares, while Amazon and Google-parent Alphabet recently announced upcoming share splits.

"Are splits the new buyback? Probably not, but highlights an additional tool to push stock prices higher despite financial theory saying otherwise," JP Morgan analysts said. 

Mr Silverblatt signalled there could be more stock splits in the offing, noting that there were still eight stocks in the S&P 500 priced over $1,000 and 15 between $500 and $1,000.