Nvidia‘s (NASDAQ: NVDA) historic 10-for-1 stock split has captured the attention of investors, marking a significant moment for the AI chip giant.
This move follows a trend set by the elite “Magnificent Seven,” a group of leading tech companies that have been soaring since the onset of the pandemic.
Among these seven giants, five have split their shares in the past four years, with two, including Nvidia, opting for a second split. Such splits have become a symbolic dance of musical chairs among tech behemoths.
The Splitting Saga: A Historical Perspective
Curiously omitted from the recent splitter roll call are household names Microsoft (NASDAQ: MSFT) and Meta Platforms (NASDAQ: META). With Nvidia out of the way, these two giants stand in line with the loftiest share prices among the Magnificent Seven, making them prime candidates for the next stock split.
Bringing such historical context to light accentuates the momentous decision each of these companies could make in the coming months.
| Company | Date | Size of Split |
|---|---|---|
| Apple | Aug. 28, 2020 | 4-for-1 |
| Tesla | Aug. 31, 2020 | 5-for-1 |
| Nvidia | July 20, 2021 | 4-for-1 |
| Amazon | June 6, 2022 | 20-for-1 |
| Alphabet | July 15, 2022 | 20-for-1 |
| Tesla | Aug. 24, 2022 | 3-for-1 |
| Nvidia | June 7, 2024 | 10-for-1 |
Data source: Company reports.
The Predictions: Microsoft and Meta Platforms in the Spotlight
Will Microsoft do a stock split?
Microsoft, reigning as the world’s most valuable company, has a storied history with stock splits, the most recent dating back to February 2003. Under the transformative leadership of CEO Satya Nadella, Microsoft has not only mended old rivalries but has also embraced innovative sectors like cloud computing and AI, driving its shares to all-time highs.
Although Microsoft has remained silent on the topic, a split could be a strategic move to ensure alignment with the norms of the Dow Jones Industrial Average.
Will Meta Platforms do a stock split?
Contrary to its peers, Meta Platforms has yet to experience a stock split, despite an impressive growth trajectory since its IPO in 2012. The recent initiation of dividends hints at a potential shift in the company’s capital strategy but remains mum on split prospects.
With a share price surpassing its group members, a stock split could enhance its appeal to retail investors and potentially secure a spot in the esteemed Dow Jones ranks.
The Verdict: An Imminent Decision?
Given the circumstances, Meta Platforms emerges as the frontrunner for a potential stock split. Armed with a combination of higher share price and favorable valuation metrics, all signs point to a future divided for Meta.
While no certainties exist in the stock market, a split might be the logical next step for Meta Platforms to sustain its upward trajectory.
Final Thoughts
Before leaping into investments, it’s prudent to weigh all possibilities. The Motley Fool Stock Advisor team, renowned for their foresight, has highlighted stocks poised for remarkable growth, with Meta Platforms not making the recent cut.
Reflecting on past success stories with Nvidia serves as a compelling reminder of the wealth-generating potential that stock investments can offer.
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