It's just about the psychology of price. People are influenced by the share price. A share price of under a dollar seems cheap and a share price of 500 dollars seems expensive regardless of the actual market cap.
It's just like the psychology of Daylight Savings time -- even though people could get up an hour early in the summer, they won't unless the clock tells them it is time to get up.
DST actually causes more problems than it solves. It would be more beneficial to eliminate DST entirely, simplify time zones dramatically, and just let people do what they want with their time.
DST is meant to solve the problem of 'sun comes up earlier', but all it accomplishes nowadays is to ensure that you get to work closer to the same amount of time after the sun comes up, which makes no real sense. In effect, it shortens mornings because you just end up stuck at work faster.
As a surfer, I get up 1h15m before sunrise regardless due to winds. I'd be getting up at 4:00 am tomorrow without DST. This sounds awesome until you realize I'd have to go to bed at 9, and most people are still up at 9.
It keeps the outdoors set (including construction, aviation, farming and landscaping) in sync with the indoors crowd.
But, if that's the case, then people who are not dealing in pop-psychology, but instead in cold-hearted company assessment would stand to make a lot of money, and, in doing so, would quickly drive the value of AAPL to it's correct number.
If the markets were efficient or in any way a true reflection of value that might be the case. In reality this sort of change can impact the percived value as can a lot of other noise people react to every day. As they say, in the short term the market is a beauty contest, maybe the act of splitting makes the company looks cooler, proactive, smart. Who knows.
Whenever people are concerned there's no such thing as cold-hearted assessment. The only trading entities that are cold hearted are algorithms.
I absolutely agree with you that there are a lot of people who will purchase the stock out of emotion just because the stock now seems more "affordable" - but I'm saying those people who enter the market and play on emotion and "gut feel", will be absolutely destroyed by the professionals who have vast amounts of information and insight into what the long term price of these stocks will be. Those "professionals" may blow the occasional call, but, in the long term, over hundreds/thousands of stocks - they will move the market to the the long term "weighing device" valuation.
So, yes, if Apple were looking for a short term bump in AAPL, perhaps a stock split might, just might be the right play - but, for long term valuation, I am struggling to understand why a stock split has any merit whatsoever.
