Chipotle's board has approved a 50-for-1 stock split. Here's what that means

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In a rare move on Wall Street, Chipotle Mexican Grill’s board has approved a 50-for-1 stock split

NEW YORK — In a rare move on Wall Street, Chipotle Mexican Grill's board has approved a 50-for-1 stock split.

In an announcement Tuesday, the burrito chain lauded the proposed split as one of the biggest in New York Stock Exchange history — while noting it believed the move would also boost accessibility of the company's stock.

“This is the first stock split in Chipotle’s 30-year history, and we believe this will make our stock more accessible to employees as well as a broader range of investors,” Jack Hartung, Chipotle's chief financial and administrative officer, said in a prepared statement.

But despite approval from its board of directors, the split isn't set in stone just yet. Chipotle still needs the greenlight from shareholders, which is expected in June.

Here's what you need to know.

A stock split is when a company increases its number of outstanding shares. That changes the price per share, but not the overall value of shareholders' holdings.

In Chipotle's case, the board has approved a 50-for-1 stock split — meaning each Chipotle share is set to be split into 50 smaller shares. If that split was done today, the price of Chipotle's stock, which stood at around $2,900 midday Wednesday, would soon cost just $58.

Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, notes this is “partially psychological," with companies turning to stock splits in hopes of lowering high prices that may intimidate investors. On the other end of the spectrum, there are also reverse stock splits — which increases price per share, but again doesn't change value of those holdings.

Silverblatt added that stock splits overall