Middleby to Split 3-for-1

Apple ($AAPL) recently split 7-for-1 but there’s another high-priced stock that’s due to split. Next week, Middleby ($MIDD) will split its shares 3-for-1.

Middleby is not very well known but it’s been an amazing performer. The shares are currently at $246. Shortly after 9/11, they hit $2. That’s a 123-fold gain in less than 13 years.

So you’d think Middleby would be a highly popular stock, right? Not at all. Only a few analysts follow it. I think the high nominal share price may scare some traders away. Miidleby usually trades about 150,000 shares each day. That may sound like a lot but consider the action at Bank of America which often trades more than 70 million shares per day.

Here’s how Middleby describes itself:

The Middleby Corporation is a global leader in the foodservice equipment industry. The company develops, manufactures, markets and services a broad line of equipment used for commercial food cooking, preparation and processing.

Sexy, I know.

Too many investors think that a great company has to be someone inventing the 12th dimension. That’s simply not the case. It can often be a boring company in a dull industry that does its job very, very well.

Side note: I’m glad to see the decline and fall of stock splits. In the 90s, companies split their shares by small amounts all the time. In my opinion, splits should be at least 2-for-1, and more often 3-for-1 or 4-for-1. Splits should happen once every 15 years or so. The airliner JetBlue split 3-for-2 three times in three years despite the stock not really doing much.

Posted by Eddy Elfenbein on June 17th, 2014 at 10:52 am

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