Apple CEO Tim Cook congratulates customers on the grand opening of Apple’s flagship store Fifth Avenue on September 20, 2019 in New York.
Taylor Hill Getty images
Shares of Apple and Tesla rose sharply on Monday, the first day after their recently announced shares split as investors continued to accumulate popular names.
Apple advanced 4% and was the most efficient component in the Dow Jones industrial average. Meanwhile, Tesla jumped about 1
Monday’s earnings are just the latest in a series of strong results, as the two companies have announced they will split their shares.
Apple said on July 30, its board approved a 4-for-1 share split. Since then, stocks have increased by more than 32%. Tesla announced a 5-for-1 split on August 11, and shares have jumped more than 70% since then.
However, legendary investor Leon Cooperman believes that these runs on the back of the share split announcement are a worrying sign for the market.
“Look at Tesla and Apple: Everyone understands that [stock] the split doesn’t create value, “Cooperman, founder of Omega Advisors, told CNBC’s Squawk Box on Monday.” My father once told me that if you give me five singles for $ 5, I’m no better. “
Monday’s gains at Apple and Tesla come amid high volumes as smaller traders are able to snap shares of the two companies at a much lower price than Friday.
In the first hour and a half of Monday’s session, Apple traded 82.7 million shares, which is approximately 46% of the average 30-day volume of 178,588 million shares. Shares of Tesla traded 37.4 million times, more than half of the 30-day volume of 73.369 million.
This year, smaller retailers are more active in the market, as without commission online brokerage Robinhood is growing in popularity. Cooperman, however, sees this as a potential sign of overheating.
“I see signs of market euphoria: the IPAC SPAC market is one, [and] the madness in many of the stocks that the Robinhood mob has closed, “Cooperman said.” You see, Kodak goes from $ 1.50 to $ 60 and from $ 60 to $ 6 in a very short amount of time … and when you look at it, it’s Robinhood’s crowd taking it. “
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