Push Out

DEFINITION of 'Push Out'

One of two ways to effect a stock split. In a push out, new share certificates are forwarded to existing shareholders, without it being necessary for them to surrender their previous share certificates. The shares on existing and new certificates have the same new value. The push out method is less cumbersome and more efficient than the alternative call-in method, which effects a stock split by replacing existing share certificates held by shareholders with new share certificates.

BREAKING DOWN 'Push Out'

For example, if a company uses the push out method for the stock split, the holder of 500 shares in a company that has declared a 2-for-1 split will receive another share certificate for 500 shares. The 500 shares on both the old and new share certificates will have identical value.

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RELATED FAQS
  1. I hold stock certificates in a company that just had a stock split. What happens ...

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    Before online brokers and personally-directed accounts, holding a physical stock certificate was a necessity, as this was ... Read Answer >>
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