1 Existing Share Split Into 288 Shares Already: 2 Out Of Seven Titan Stocks Likely Next In-Line For Splitting

Hopes were high that the world's largest artificial intelligence company, Nvidia would split anytime soon since it broke history on Wall Street after its robust earnings. However, chances are that Nvidia won't be splitting anytime soon. As per The Motley Fool, there is quite a case for stock splits by two giants out of the seven magnificent stocks.

The US market is at an all-time high with the Dow Jones Industrial Average rising by 22%, the S&P 500 skyrocketing by 33%, and the Nasdaq outperforming its counterparts with over 43% surges in a year.

Amidst record highs, Nvidia has been a banger stock, touching an all-time high of $974 and climbing up the ladder to become the world's third-largest company with a market valuation of $2.44 trillion currently. Nvidia shares have corrected sharply from its record high to a staggering $857.74, but are still very expensive.

However, as per Motley's report, Nvidia is set to face an ever-growing mountain of headwinds this year, and there's a real possibility the company's stock is an epic bubble. In other words, a split may not be in the cards anytime soon.

But Motley sees potential in two giants out of the magnificent sevens.

Firstly, these seven magnificent stocks are -- Microsoft, Apple, Amazon, Alphabet, Meta Platforms, Nvidia and Tesla. These stocks are all leaders in their respective fields. And notably, some of their founders are already in a riff-off of holding the title of the world's richest man. Currently, the top 5 rich list is dominated by Bernard Arnault of LVMH, followed by Jeff Bezos, Elon Musk, Mark Zuckerburg, and Bill Gates.

Coming to their stocks, Motley picks Meta Platforms and Microsoft for possible split.

Meta Platform:

Meta formerly known as Facebook, is currently sitting on a pile of cash. As per its financial results for the fourth quarter and full year 2023, Meta has cash, ash equivalents, and marketable securities - Cash, cash equivalents, and marketable securities were $65.40 billion as of December 31, 2023. Free cash ow was $11.50 billion and $43.01 billion for the fourth quarter and full year 2023, respectively.

As per the report, hefty cash gives room for Meta's chief Mark Zuckerburg to take chances. Also, it pointed out that Meta is highly inexpensive despite massive gains since last year.

Notably, Meta shares have never gone for a stock split since their listing in 2012. The stock has given huge 1,164.95% all-time returns since May 2012. At the start of March 2024, Meta touched a record high of $523.57.

In the full year of 2023, Meta's revenue stood at $134,902 million, up by 16% YoY, while net income stood at $39,098 million, registering a massive 69% upside YoY.

Meta is expecting the first quarter of 2024 total revenue to be in the range of $34.5-37 billion. For full-year 2024, the company expects total expenses to be in the range of $94-99 billion, unchanged from its prior outlook, while capital expenditures will be in the range of $30-37 billion, a $2 billion increase of the high end of its prior range.

Meta builds technologies that help people connect, nd communities, and grow businesses. When Facebook launched in 2004, it changed the way people connect. Apps like Messenger, Instagram, and WhatsApp further empowered billions around the world.

Meta is also a vision for advancing AI and the metaverse.

Microsoft:

Unlike Meta, Bill Gates-backed Microsoft has undergone nine stock splits from 1987 to 2003, but since then it has been a dry run.

Microsoft's first two stock splits were of the ratio 1:2 each in September 1987 and April 1990 respectively. This was followed by two more stock splits in the ratio of 3:2 this time in June 1991 and 1992 the same month.

But Microsoft carried five stock splits of 2:1 ratio each from 1994 to 2003.

As per the data, overall, 1 share of Microsoft before September 21, 1987, has been split into 288 equity shares if you stayed invested for the entire nine stock splits.

Currently, Microsoft shares are at $404.52 per share. Recently, the stock touched a record high of $420.82 per share.

In a year, Microsoft shares gained by 59.4%, while in 5 years, the stock zoomed by 249%. The maximum gain of Microsoft is a breathtaking 404,520%.

According to Motley's report, Microsoft's legacy operations are still exceptionally profitable. Also, the company's cash flow comes from Windows and Office which signals the possibility of reinvestment in high growth measures or carry acquisitions.

By the end of the December 2023 quarter, Microsoft held cash and cash equivalents to the tune of $17,305 million. In the quarter, revenue was at $62.0 billion and increased 18% (up 16% in constant currency). Net income stood at $21.9 billion increased 33%, and increased 26% non-GAAP (up 23% in constant currency).

Disclaimer: The write-up is for information purposes, and is not a recommendation to buy, sell or hold. We have not done fundamental or technical analysis and have no opinion on the stock mentioned. Neither, the author nor Greynium Information Technologies should be held liable for any losses. Please consult a professional advisor.