Meta Platforms (META, Financial), the parent company of Facebook, has seen its stock price soar to a historic high of $736.67 per share, marking a year-to-date increase of over 25%. This surge positions Meta as the standout performer among the "Magnificent Seven" of US stocks, despite a slight pullback recently. As the stock continues to rise, investors are increasingly calling for Meta's first stock split since its 2013 IPO. Currently, Meta is the only company within the "Magnificent Seven" that hasn't undergone a split.
Stock splits typically occur when a company's share price becomes too high for most retail investors, prompting a division of shares to make them more accessible. This does not alter the company's fundamentals but can enhance stock appeal. Companies like NVIDIA (NVDA) and Broadcom (AVGO) have also split their stocks due to rapid advancements in AI technologies.
Stock splits are not only attractive to retail investors but can also boost market enthusiasm. According to Bank of America data, companies that split their stocks had an average one-year return of over 25%, compared to a 12% return for the overall market.
Since 2022, five of the "Magnificent Seven" – NVIDIA, Alphabet (GOOGL), Amazon (AMZN), Tesla (TSLA), and Apple (AAPL) – have executed stock splits. Other potential candidates for stock splits include Netflix (NFLX), ServiceNow (NOW), and Intuit (INTU), among others.
