Stock Splits: A Bullish Signal for Expensive Stocks
In the world of investing, stock splits are often seen as a positive sign for companies. While they don’t directly impact a company’s market value, they have historically been viewed as a bullish signal. Nvidia recently announced a forward stock split, becoming the eighth company this year to do so. This move follows in the footsteps of other mega-corporations like Walmart and Chipotle.
When a company enacts a stock split, it typically indicates strength and growth in the underlying business. High stock prices can sometimes make it difficult for employees and retail investors to invest in a company, which is why stock splits can help increase accessibility and liquidity in the market.
According to Bank of America, there are approximately 36 companies in the S&P 500 index with stock prices above $500 per share that are prime candidates for stock splits. Among these companies, there are eight with stock prices exceeding $1,000 per share that are even more likely to enact a split.
Some of the high-priced S&P 500 stocks that could potentially benefit from a stock split include:
– Deckers Outdoor (DECK) with a stock price of $1,033.80
– TransDigm Group (TDG) with a stock price of $1,348.40
– Fair Isaac (FICO) with a stock price of $1,371.89
– Broadcom (AVGO) with a stock price of $1,411.14
– Mettler-Toledo (MTD) with a stock price of $1,474.15
– AutoZone (AZO) with a stock price of $2,790.63
– Booking Holdings (BKNG) with a stock price of $3,795.04
– NVR Inc (NVR) with a stock price of $7,438.82
Overall, stock splits can be a positive indicator for investors and a signal of confidence from companies in their future growth potential. Keep an eye on these high-priced stocks for potential split announcements in the near future.