Amazon surges after announcing 20-for-1 stock split and up to $10 billion of buybacks

• Amazon shares soared in late trading Wednesday after the company announced a stock split.
• Amazon's board also authorized it to buy back up to $10 billion worth of its shares.

Shares of Amazon rose more than 7% in late trading Wednesday after the company announced that its board had approved a 20-for-one stock split.

In the same filing, the online juggernaut also said its board authorized it to buy back up to $10 billion worth of company stock, a doubling of the current buyback plan originally authorized in 2016. $2.12 billion worth of shares have been repurchased under that plan, it said.

Unlike the stock split, which has virtually no effect on the stock's underlying value, the repurchasing program will decrease the total number of shares outstanding, thereby making them more scarce and upping their value to investors.

Stock splits can make shares more accessible to a wider range of investors. Amazon closed just above $2,785 per share on Wednesday. At that price, a split would take their price below $150 each. The stock was up almost 7% at $2,970 in after-hours trade.

Last month, Alphabet announced a similar 20-for-one split.

Assuming shareholders approve the plan at Amazon's annual meeting in May, trading should begin on a split-adjusted basis on June 6, Amazon said.