McKayla Rosevear
Period 8
Stock Assignment
The stock that did not do very well for me was Starbucks. It started out at
$88.88 a share. I expected it to just keep on going up, but that wasn’t the case.
In week 4 it dropped to $48.09 suddenly. It was very surprising and I was
confused what could have happened. By the end, it went up a little bit to
$54.41 a share.
There is an explanation for such an unexpected drop in price. In April,
Starbucks began trading on a “split-adjusted basis after its 2-for-1 stock split was
paid” (Udland, 2015). This means that you now have two Starbucks shares for
the price of 1 share. That is the only change in the system. The prices are
exactly half of what they were before. That way it’s cheaper to buy stock in the
company now.
The company wanted to “increase shareholder value, enhance the
liquidity of their shares, and build an attractive share price” (Company, 2015).
This will benefit their company. To conclude, the share price did drop, but not
because there was a lack of business. The company is doing very well and the
price will rise again. You are just getting 2 stocks for half the price.
McKayla Rosevear
Period 8
The stock that did well for me was Amazon. It started at $312.21 a share. I
knew it would go up. Amazon does well. At week 4 it was $383.37 and then by
week 5 it went up to $432.62. It was a huge increase in such a short amount of
time. That was unexpected. By the end it cost $423.86 a share. So it was lower
in the end. I gained over 1,000 dollars from Amazon over the 10 weeks.
An article I found stated that Amazon did really well over the holiday
season. That could be a reason for why it started out at such a high price. This
article also stated that ever since they opened the Prime program they are
doing better. In the past couple months, “Prime membership grew by 53%
worldwide” (Sikka, 2015). This is the reason for the growth of the operating profits.
Amazon increased the annual fee for prime which has helped with growth as
well.
Overall, Amazon Prime is the reason the company is doing so well. They
continue to make Prime better and more popular. Their third party sellers can
increase their sells by using the Prime program. They don’t have to store their
goods in Amazon’s warehouses. The company is making improvements in many
areas and should continue to grow.
McKayla Rosevear
Period 8
Works Cited
Company. (2015, March 18). Starbucks Announces 2-for-1 Stock Split. Retrieved from Starbucks:
https://news.starbucks.com/news/starbucks-announces-2-for-1-stock-split
Sikka, P. (2015, May 22). Amazon is Increasing the Product Selection for its Prime Program. Retrieved
from Yahoo Finance: http://finance.yahoo.com/news/amazon-increasing-product-selectionprime-190746158.html
Udland, M. (2015, April 9). No, Starbucks shares are not down 50% today. Retrieved from Business
Insider: http://www.businessinsider.com/starbucks-stock-split-april-9-2015-4
E-Portfolio link: http://mckayla184.weebly.com/finance-1050.html