Stock splits, once a relic of the past, are experiencing a renaissance in today’s market. This phenomenon, typical for high-performing companies, signifies robust operational and financial health, often driving a surge in stock price.
Historical data supports the premise that companies executing stock splits tend to witness an average 25% increase in share price post-announcement, outperforming the S&P 500 average gains. Bank of America analyst Jared Woodard’s analysis sheds light on this trend.
Broadcom: Seizing the Potential for 76% Upside
Broadcom, a tech powerhouse dominating various sectors such as semiconductors and security, recently boasted a revenue surge of 43%, reaching $12.5 billion in the second quarter. Despite a substantial gain of 152% since last year, Broadcom confidently executed a 10-for-1 stock split in July, indicating its bullish outlook.
Wall Street is abuzz with optimism, with Rosenblatt analyst Hans Mosesmann predicting a 76% upside to $240 post-split, anchored by the rise in generative AI sales and VMWare integration.
Nvidia: Riding the Wave with 99% Potential Upside
Nvidia, a dominant force in the GPU market, particularly for AI applications, recorded a phenomenal revenue spike of 262%, hitting $26 billion in the first quarter of fiscal 2025. The data center segment witnessed a skyrocketing 427% revenue increase, fueling Nvidia’s meteoric 600% stock price surge.
Despite the recent 10-for-1 stock split in June, Mosesmann foresees an additional 99% upside to $200, anchored in Nvidia’s pioneering software integration with AI processors, a facet often underestimated by analysts.
Super Micro Computer: Projecting 204% Upside Potential
Super Micro Computer, a stalwart in the server industry for over three decades, reported record revenue of $5.3 billion in the fourth quarter of fiscal 2024, showing a robust 143% year-over-year increase. Known for its energy-efficient solutions and strong partnerships with major chipmakers, Supermicro is well-positioned for AI-driven growth.
For those eyeing investment opportunities, Super Micro Computer holds a promising outlook with an implied 204% upside, underscoring its potential for substantial growth fueled by its proficiency in supplying servers optimized for AI processing.