Netflix (NASDAQ:NFLX) rose in morning trades after the world's largest subscription streaming service declared a share split.
Shares were up 1.6 percent at $691.72 at 9:44 a.m. in New York. The shares have almost doubled this year.
The 7-for-1 split takes effect July 14 and is payable to shareholders of record as of July 2, the Los Gatos, California-based company said in a statement late yesterday.
Netflix was widely expected to split its stock after announcing plans to do so in April and then gaining shareholder approval to increase its number of authorized shares this month, which is a preliminary step in a split. The last time Netflix split its stock was in 2004.
A stock split makes the company more accessible for investors and employees who want to buy in but can’t pony up hundreds of dollars for one share.
The company’s market capitalization has soared eightfold to more than $40 billion since 2012 as Netflix expanded its pioneering Web-based TV service to more than 50 countries and signed up more than 62 million subscribers worldwide.
The company has evolved from a DVD rental service to one of the active producers of TV, documentaries and films, with a long-term budget that approaches $10 billion.
Netflix, which has been aggressive about international growth, closed out its first quarter with 62.3 million members, almost a million more new subscribers than it had predicted.
As consumers spend more time watching video over the Internet, a number of large media companies have attempted to replicate Netflix’s success with their own online-only services. Others have begun selling programming to Hulu and Amazon.com Inc. to help build up some competitors.
Other higher-priced stocks have split this year, led by Apple’s 7-for-1 move, which took effect this month. Visa split 4-for-1 in March.