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How many times has Aqua America stock split?
There have been eight stock splits since 1981 and prior to September 1, 2013:
Effective Date/Split Ratio
September 1, 1986 2 for 1
June 18, 1996 3 for 2
January 12, 1998 4 for 3
December 1, 2000 5 for 4
December 1, 2001 5 for 4
December 1, 2003 5 for 4
December 1, 2005 4 for 3
September 1, 2013 5 for 4
What are the key dates for the upcoming stock split?
1. The Record Date - August 16, 2013 - determines which shareholders are entitled to receive additional shares due to the split.
2. The Split Date - September 1, 2013 - the effective date of the stock split.
3. The Ex Date - September 3, 2013 - the date determined by NYSE when Aqua America common shares start trading at the new split-adjusted price.
How does a stock split actually work?
A 5-for-4 split means that a new share of stock is issued for every four shares in existence prior to the split. FEach share is now worth 80 percent of what it was worth immediately prior to the split.
Here is an example of how the stock split was affected. Assume that as of the record date of August 16, 2013, an investor owned 100 shares of Aqua America common stock and that the market price of Aqua America stock was $30 per share, therefore the investment in Aqua America was worth $3,000. Assuming that Aqua America's stock price didn't move up or down between the record date and the date on which the split actually took place, immediately after the split, the investor owned 125 shares of Aqua America stock, but the market price would be $24 per share. The investor's total investment value in Aqua America would remained the same at $3,000 unless the stock price moved up or down with normal market movements.
Are there any personal income tax consequences as a result of Aqua America's stock splits?
The Company has been advised by its tax advisor that under Federal income tax laws receipt of additional shares will not constitute taxable income to the shareholder. The cost or other tax basis to a shareholder of each share held immediately after the split is equal to 80 percent of the tax basis of the corresponding shares held immediately prior to the split. For example, if you owned 100 shares before the split with a tax basis of $20 per share, after the split you would own 125 shares of stock with a tax basis of $16 per share. For capital gains purposes, the holding period for each of the shares will include the period for which the corresponding pre-split shares were held. Any cash paid in lieu of fractional shares results in the recognition of gain or loss measured by the difference between the amount of such cash and the basis of the fractional share redeemed and will result in a Form 1099-B for the 2013 tax year for the amount of cash paid. Cash-in-lieu is calculated based upon the split-adjusted closing price as of the record date of August 16, 2013. Foreign residents should consult their local tax advisors.
Should I have received an updated share certificate following a split?
Shareholders that hold all of their shares in certificate form prior to the split were issued a certificate for the additional shares resulting from the split. All other holders received the additional shares in electronic form. If you held your Aqua America shares in a brokerage account immediately prior to a split, the additional shares was deposited into that account.
Where are shareholder notices from Aqua America mailed?
If you have stock certificates or hold shares directly with Computershare Investor Services, any shareholder mailings from Aqua America are sent to the address that Computershare has on file. To verify your address you can call Computershare directly at 1-800-205-8314. It is your responsibility to ensure that your address is current with Computershare at all times. If Computershare is unable to contact you with shareholder notices because your current address is not on file with them, you run the risk of having your shares escheated to the state of your last known residence and losing all rights to your shares in accordance with certain state laws.
If you hold your Aqua America shares through a brokerage account, all mailings from Aqua America will be sent to the address for you that your brokerage has on file.
How do I contact the Stock Transfer Agent?
For registered shareholders that hold their shares directly in the company, you can reach Computershare (Aqua America's Stock Transfer Agent) as follows:
Phone: 1-800-205-8314 (toll-free)
250 Royall Street
Canton, MA 02021
My shares are held by a brokerage firm. How do my shares get adjusted for a stock split?
If your Aqua America shares are held in a brokerage account, they split automatically on the split date.
How does a stock split affect the number of shares outstanding and the future calculation of earnings per share?
As a result of a stock split on a 5-for-4 basis, the number of shares outstanding increases by 25 percent. Earnings per share are 80 percent of what they otherwise would have been as net income is divided into 125 percent as many shares.
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