Merck & Co. has implemented nine stock splits in its history, including the most recent split in 1999, according to the company's website. The two-for-one stock split's record date was Jan. 25, 1999, and new shares were issued in February 1999. Merck also implemented three-for-one stock splits in 1992 and 1988 and a two-for-one stock split in 1986. The company's earlier stock splits occurred in 1941, 1949, 1951, 1964 and 1972.
A company splits its stock by issuing new shares to each shareholder, but reducing the value of each share so that the company's total market capitalization remains the same, explains Investopedia. After a stock split, each shareholder owns more shares but hasn't gained or lost money overall.
For example, Merck's January 1999 stock split took effect on Feb. 17, 1999, according to Yahoo Finance. Shares had closed at $153.94 on Feb. 16, but opened at $77 the following day to account for the fact that there were twice as many shares outstanding.
Companies carry out stock splits to increase liquidity and make share prices appear more affordable to investors, according to Investopedia. Merck has carried out five 3-for-1 stock splits and four 2-for-1 splits between 1941 and 1999, Merck states, meaning that an investor who bought a single share in 1940 and never sold any shares would have held 3,888 shares by 1999.