Ask Matt: When will Facebook split its stock?

Q: When will Facebook split its stock? 

A: Facebook (FB) is the latest stock break the $110-a-share barrier. That’s a level beyond which many individual investors expect a stock split. On cue, Facebook announced plans earlier this year to split the shares, but the timing is unclear.

In April, Facebook announced it would create a new class “C” of stock. Current holders of both the Class A shares held by most investors and the Class B shares largely controlled by CEO Mark Zuckerberg will get two shares for every share of “A” and “B” shares they own. The move will be akin to a stock split because investors will get two new shares of "C" stock for every share of Class A shares and “B” shares they own. Stock splits are typically a maneuver to lower the per-share price of a stock, by increasing the supply, to make the share price more palatable. A stock split leaves investors with more shares, but at a lower price, so the economic value is a wash. Facebook’s move, however, is more of a move to make sure Zuckerberg can maintain control of the company as it brings on more employees and attracts more investors.So far, Facebook has not given an update on the timing of the Class C issuance.

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.