Cerner Inc. (NASDAQ: CERN) is acting like the stock market is back to 1999 or 2000 all over again. Now that the healthcare solutions provider’s shares are up more than 20% so far in 2013 alone and effectively trading at an all-time high, the company announced on Tuesday that it is splitting its stock on a 2-for-1 basis. This will mark the third such stock split since 2005 alone and would mark the sixth 2-for-1 stock split in its history as a public company.

What is interesting here is that Cerner has a $16.4 billion market capitalization. The stock has risen and risen through time, which would coincide with an ability to have six stock splits over a 20-year period. Cerner’s investor FAQ website shows the following:

Does Cerner issue dividends? And, does Cerner have a DRIP plan?

No, Cerner currently does not issue dividends and does not have a DRIP plan.  

Cerner said, “Each shareholder of record on June 17, 2013 will receive one additional share of common stock for each share held on that date. The distribution date for the new shares will be on or about June 28, 2013. Cerner had approximately 172.3 million shares of common stock outstanding as of May 24, 2013.” The newly announced stock split will increase the common shares outstanding to approximately 344.6 million.

What we find a bit interesting here is that Cerner pays no formal cash dividend even though this is being paid in the form of a 100% stock dividend. As this stock has grown and grown it hasn’t had to pay a dividend. With a $16+ billion market cap, Cerner claims over $1 billion in combined cash and short-term investments, followed by another $515 million or so on “long-term investments” on its books and almost no real long-term debt.

We are not going to name Cerner to our list of dividend sinners because it has managed to keep returning heavy long-term gains for shareholders. That being said, if the company chose to adopt a 40% income payout ratio for dividend payments, the $2.82 consensus 2013 earnings per share from Thomson Reuters would generate an annualized dividend of roughly $1.13 per share. Unfortunately, that is a theoretical dividend yield of only about 1.2%.

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