The board at Compaq US has approved a five to two splitting of its shares to encourage more investors to buy its stock.
That follows a successful last year or two where Compaq stock has risen higher and higher.
After its announcement that it would buy Tandem, Compaq shares dropped but it is still an attractive buy for people who routinely buy and sell shares.
Cost cutting at Compaq, driven by charismatic CEO Eckhard Pfeiffer, has caused the share price to continue rising. He is determined to make sure that his company can continue to compete with direct sellers Gateway and Dell.
The move anticipates people buying more, rather than less shares in Compaq, and is tried and tested method by US companies to raise more money.
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