Stock Split Updates: Is Now the Right Time to Invest in Nvidia and Chipotle?

Money | June 25, 2024, 4:23 a.m.

Stock splits have been a popular trend this year with companies like Walmart, Nvidia, and Chipotle all announcing splits to make their shares more accessible. However, the decision on whether to invest in split stocks depends on who you ask. Some analysts believe that stocks that split tend to outperform the market in the year following the announcement, while others argue that a split is not a reliable indicator of future value. Experts like Peter Ricchiuti suggest that stocks split because the companies are performing well, leading to continued growth. There are two kinds of stock splits: forward splits decrease the share price and increase the number of shares, while reverse splits do the opposite. Performance data shows that historically, split stocks have outperformed the market in the year following the split announcement. However, opinions differ on whether this outperformance is sustainable over time. Investors should consider various factors, including the current market conditions and the company's performance, before deciding to buy or sell split stocks. As the trend of stock splits continues, analysts are keeping an eye on companies with high share prices as potential candidates for future splits.