10 Stocks That May Be Splitting Soon

In this article, we will discuss the 10 stocks that may be splitting soon.

A stock split is when a company increases its number of outstanding shares in an effort to boost its stock’s liquidity and make it more affordable for investors. The underlying value of the business does not change, since the price of each share decreases in proportion to the increase in the number of outstanding shares. For example, if a company has 100,000 shares outstanding at a price of $10 per share, its market cap would be $1 million. If the company decides to go for a 2-for-1 stock split, the company will then have 200,000 shares outstanding at a price of $5 per share, and the market cap will stay the same at $1 million. Stock splits are usually carried out on a regular basis, such as every quarter or every year. They are often seen as a sign of a company’s health and growth potential. Stock splits can also be beneficial for companies as they can repurchase their shares at a lower price. Typically, stock splits are indicative of a company’s health and growth and are also indicative of management’s confidence in their business.

Mega Caps That Split In 2022

Stock splits have been all the rage in 2022, with mega caps like Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOG), and Tesla, Inc. (NASDAQ:TSLA) leading the way. On February 1, Alphabet Inc. (NASDAQ:GOOG) announced a 20-for-1 stock split, under which shareholders of record on July 1, received 19 additional shares of Alphabet Inc. (NASDAQ:GOOG) on July 15, 2022. On March 9, Amazon.com, Inc. (NASDAQ:AMZN) declared a 20-for-1 stock split for shareholders of record on May 27, payable on June 3, 2022. As of November 9, Amazon.com, Inc. (NASDAQ:AMZN) is trading at $88 per share. On August 4, Tesla, Inc. (NASDAQ:TSLA) announced that its board of directors has approved a 3-for-1 stock split for investors of record on August 17, 2022. Tesla, Inc. (NASDAQ:TSLA) shareholders received 2 additional shares per share on August 24, 2022.

A hawkish Fed is spooking investors away from the equities market, triggering major sell-offs. As of November 9, the S&P 500 has sunk 20% year to date, the Dow has lost 10% since the beginning of the year, and the Nasdaq is down more than 30% for the year. We have compiled a list of 10 stocks that may be splitting soon to spark up investor interest and make shares more accessible to small investors. Some of the potential companies that may follow suit and announce a stock split soon include Lam Research Corporation (NASDAQ:LRCX), Booking Holdings Inc. (NASDAQ:BKNG), and Thermo Fisher Scientific Inc. (NYSE:TMO). These stocks, among others, are discussed in detail in the article below.

Photo by Yiorgos Ntrahas on Unsplash

Our Methodology

To determine the 10 stocks that may be splitting soon, we did our research to identify companies that have solid track records of profitability and successful execution. We considered business fundamentals and various financial metrics to identify potential candidates for stock splits. Along with each stock, we have mentioned the hedge fund sentiment, stock split history, and analyst ratings. Please keep in mind that this is an opinion article and the companies presented in this article may not be splitting anytime soon. Here are the 10 stocks that we believe may be splitting soon, ranked according to their popularity among elite hedge funds from least popular to most popular.

10 Stocks That May Be Splitting Soon

10. Seaboard Corporation (NYSE:SEB)

Number of Hedge Fund Holders: 14

Seaboard Corporation (NYSE:SEB) operates as an agribusiness and transportation company worldwide. The company has six business divisions: Pork, Commodity Trading & Milling (CT&M), Marine, Sugar & Alcohol, Power, and Turkey. As of November 9, Seaboard Corporation (NYSE:SEB) is trading at $3,890 a share and at a PE multiple of 9x. The company has a long history of success and growth and has never split its stock. Seaboard Corporation (NYSE:SEB) is ranked among the stocks that may be splitting soon.

On November 1, Seaboard Corporation (NYSE:SEB) posted earnings for the fiscal third quarter of 2022. The company reported earnings per share of $125.78 and generated a revenue of $2.9 billion, up 27.2% year over year. The company also announced that its board of directors has approved a quarterly cash dividend of $2.25 per common share, which is payable on November 21 to stockholders of record at the close of business on November 11.

At the close of Q2 2022, 14 hedge funds held stakes in Seaboard Corporation (NYSE:SEB). The collective value of these stakes amounted to $99.6 million. This is compared to 15 positions in the preceding quarter with stakes worth $96.4 million. As of June 30, Kahn Brothers is the top investor in Seaboard Corporation (NYSE:SEB) and has a position worth $38.4 million.

Other viable candidates that have a stock split long overdue include Lam Research Corporation (NASDAQ:LRCX), Booking Holdings Inc. (NASDAQ:BKNG), and Thermo Fisher Scientific Inc. (NYSE:TMO).

9. W.W. Grainger, Inc. (NYSE:GWW)

Number of Hedge Fund Holders: 30

W.W. Grainger, Inc. (NYSE:GWW) is a leading global distributor of maintenance, repair, and operating products The company operates through two segments: High-Touch Solutions N.A. and Endless Assortment. W.W. Grainger, Inc. (NYSE:GWW) has had 3 splits in history, with the most recent one being a 2-for-1 split in June 1998. The company’s share price has soared from roughly $50 at the time of the split to $595, as of November 9. W.W. Grainger, Inc. (NYSE:GWW) is ranked among the stocks that may split soon.

On October 28, W.W. Grainger, Inc. (NYSE:GWW) announced earnings for the fiscal third quarter of 2022. The company reported earnings per share of $8.27 and outperformed expectations by $1.02. The company generated a revenue of $3.94 billion, up 16.90% year over year, and beat estimates by $73.57 million. Shortly after the company’s earnings release, Baird analyst David Manthey raised his price target on W.W. Grainger, Inc. (NYSE:GWW) to $640 from $590 and maintained an Outperform rating on the shares.

At the end of Q2 2022, W.W. Grainger, Inc. (NYSE:GWW) was spotted on 30 investors’ portfolios that held collective stakes of $304.6 million in the company. As of June 30, Citadel Investment Group is the top investor in W.W. Grainger, Inc. (NYSE:GWW) and has a position worth $66.2 million in the company.

8. NVR, Inc. (NYSE:NVR)

Number of Hedge Fund Holders: 32

NVR, Inc. (NYSE:NVR) is a major homebuilder in the United States. The company has two business divisions: Homebuilding and Mortgage Banking. NVR, Inc. (NYSE:NVR) is profitable and is also efficient at making profits for shareholders. The company has a trailing twelve-month operating margin of 21.34% and an ROE of 52.62%. The company has never split its stock since going public, and its stock split may be over due. As of November 9, NVR, Inc. (NYSE:NVR) is trading at a PE multiple of 9x and has a share price of $4,100. The stock ranks among the stocks that may be splitting soon.

On October 25, NVR, Inc. (NYSE:NVR) announced earnings for the fiscal third quarter of 2022. The company reported an EPS of $118.51 and generated a revenue of $2.74 billion, up 17.24% year over year, and ahead of Wall Street estimates by $167.85 million. This October, BofA analyst Rafe Jadrosich resumed coverage of NVR, Inc. (NYSE:NVR) with a Buy rating and a $4,900 price target.

At the close of Q2 2022, 32 hedge funds were long NVR, Inc. (NYSE:NVR) and disclosed stakes of $434 million in the company. As of September 30, Diamond Hill Capital is the top investor in NVR, Inc. (NYSE:NVR) and has stakes worth $495 million in the company.

Here is what Ensemble Capital Management had to say about NVR, Inc. (NYSE:NVR) in its third-quarter 2022 investor letter:

“NVR, Inc. (NYSE:NVR): The US housing market has been unstable so far this year, as rising mortgage rates and higher housing prices have rapidly reduced affordability. Fortunately for existing homeowners, most of whom own their houses outright or have locked in low, fixed mortgage rates, rising rates have not directly impacted their finances unless they have an outstanding variable-rate home equity line of credit.

Homebuilders, who rely on incremental demand for housing, have seen demand dry up in response to declining affordability. Single-family home building permits have plummeted in recent months back to pre-pandemic levels.

That’s the bad news. On the bright side, the building materials supply chain, which delayed construction and increased the cost to build a home, is rapidly improving. This bodes well for homebuilders like NVR with a track record of cost discipline. In other words, even if NVR’s average selling price declines, it can maintain attractive gross margins if they simultaneously control costs…” (Click here to read the full text)

7. Mettler-Toledo International Inc. (NYSE:MTD)

Number of Hedge Fund Holders: 39

Mettler-Toledo International Inc. (NYSE:MTD) is a leading provider of precision instruments and services worldwide. The company benefits from a strong competitive position in the marketplace, with a wide range of products and services that address the needs of customers in a variety of industries. Mettler-Toledo International Inc. (NYSE:MTD) has a long history of innovation and customer focus, which has resulted in strong relationships with its customer base. The company has a strong financial position, with a history of consistent profitability and cash flow generation. The company has a trailing twelve-month operating margin of 28.28% and free cash flows of $691.7 million. Mettler-Toledo International Inc. (NYSE:MTD) is another company whose stock split may be long overdue, and is trading at $1,331 a share, as of November 9. Mettler-Toledo International Inc. (NYSE:MTD) ranks among the stocks that may split soon.

On November 3, Mettler-Toledo International Inc. (NYSE:MTD) posted earnings for the fiscal third quarter of 2022. The company reported earnings per share of $10.18 and beat estimates by $0.35. The company generated a revenue of $985.85 million and outperformed Wall Street consensus by $12.17 million. After the company posted a strong print for Q3, Goldman Sachs analyst Matthew Sykes upgraded Mettler-Toledo International Inc. (NYSE:MTD) to Neutral from Sell and raised his price target on the shares to $1,355 from $1,120.

At the end of Q2 2022, 39 hedge funds were bullish on Mettler-Toledo International Inc. (NYSE:MTD) and disclosed stakes of $1.51 billion in the company. This is compared to 36 positions in the preceding quarter with stakes worth $1.50 billion. As of June 30, Fundsmith LLP is the largest shareholder in the company and has disclosed a position worth $620.85 million.

Here is what Baron Funds had to say about Mettler-Toledo International Inc. (NYSE:MTD) in its third-quarter 2022 investor letter:

“Mettler-Toledo International Inc. (NYSE:MTD) is a leading provider of weighing instruments for use in laboratory, industrial, and food retailing applications. Mettler detracted from performance as the stock fell due to investor concerns about a possible global recession and the impact of foreign currency fluctuations on the company’s earnings. We believe that Mettler’s business has historically proved resilient in the face of macroeconomic challenges, and we expect Mettler will continue to compound its earnings at mid-teens or better growth rates over the long term.”

6. O’Reilly Automotive, Inc. (NASDAQ:ORLY)

Number of Hedge Fund Holders: 41

O’Reilly Automotive, Inc. (NASDAQ:ORLY) is a leading retailer in the auto parts and accessories industry with over 5,900 stores in 47 states. The company has a strong history of growth and profitability and is well-positioned to continue its growth in the future. The company has a diversified product mix, and a strong brand name, and is a leading player in the growing auto parts market. O’Reilly Automotive, Inc. (NASDAQ:ORLY) has split its stock 3 times in its history of being a public company. The most recent split was a 2-for-1 stock split in June 2005, and its share price has skyrocketed from roughly $30 at the time of the split to $829.40, as of November 9. O’Reilly Automotive, Inc. (NASDAQ:ORLY) is ranked among the stocks that may be splitting soon.

This October, UBS analyst Michael Lasser raised his price target on O’Reilly Automotive, Inc. (NASDAQ:ORLY) to $940 from $855 and maintained a Buy rating on the shares. On October 28, Truist analyst Scot Ciccarelli raised his price target on O’Reilly Automotive, Inc. (NASDAQ:ORLY) to $892 from $765 and reiterated a Buy rating on the shares.

At the end of Q2 2022, 41 hedge funds were long O’Reilly Automotive, Inc. (NASDAQ:ORLY) and held stakes worth $2.40 billion in the company. As of June 30, Akre Capital Management is the largest investor in the company and has a position worth $992.8 million.

In addition to O’Reilly Automotive, Inc. (NASDAQ:ORLY), some of the potential stocks that may announce a stock split soon include Lam Research Corporation (NASDAQ:LRCX), Booking Holdings Inc. (NASDAQ:BKNG), and Thermo Fisher Scientific Inc. (NYSE:TMO).

5. AutoZone, Inc. (NYSE:AZO)

Number of Hedge Fund Holders: 42

AutoZone, Inc. (NYSE:AZO) is a leading retailer and one of the largest distributors of automotive parts and accessories in the United States. The company offers a wide variety of products for cars, trucks, and SUVs. AutoZone, Inc. (NYSE:AZO) is committed to providing the best possible service to its customers. The company is cash-rich and has a strong track record of delivering shareholder value. The company has free cash flows of $2.53 billion. On October 4, AutoZone, Inc. (NYSE:AZO) announced its board of directors has authorized a share buyback program of $2.5 billion of the company’s common stock. The company has authorized $33.7 billion in share repurchases since 1998.

AutoZone, Inc. (NYSE:AZO) has split its stock two times in its history of being a public company. The company’s most recent split was a 2-for-1 stock split in April of 1994, and its share price since then has surged from $29 to $2,464 per share, as of November 9. AutoZone, Inc. (NYSE:AZO) is ranked high among the stocks that may split soon.

On October 20, Truist analyst Scot Ciccarelli raised his price target on AutoZone, Inc. (NYSE:AZO) to $2,533 from $2,292 and maintained a Buy rating on the shares.

At the close of Q2 2022, 42 hedge funds were eager on Autozone, Inc. (NYSE:AZO) and disclosed positions worth $1.28 billion in aggregate. As of September 30, Aubrey Capital Management is the top investor in AutoZone, Inc. (NYSE:AZO) and has stakes worth $4.07 billion in the company.

Here is what Carillon Tower Advisers had to say about AutoZone, Inc. (NYSE:AZO) in its second-quarter 2022 investor letter:

“AutoZone, Inc. (NYSE:AZO) sells automotive replacement parts and accessories. The company reported another solid quarterly update that highlighted particularly robust growth in its commercial segment, market share gains, and stable gross margins. Additionally, investors have appreciated the company’s historically stable business model that is positioned to perform well in periods of economic stress.”

4. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN)

Number of Hedge Fund Holders: 44

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is a leading global biotechnology company that discovers, develops, manufactures, and commercializes medicines for treating various diseases. The company has a strong pipeline of products in various stages of development, including treatments for age-related macular degeneration, non-alcoholic steatohepatitis, atopic dermatitis, and psoriasis.

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is among the companies whose stock split is long overdue. The company has never split its stock in history and, as of November 9, is trading at $743 per share. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is ranked high among the stocks that may split soon.

On November 9, Truist Securities analyst Robyn Karnauskas raised his price target on Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) to $856 from $790 and maintained a Buy rating on the shares.

At the end of Q2 2022, Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) was a part of 44 investors’ portfolios that held positions worth $1.60 billion in the company. As of June 30, Renaissance Technologies is the top investor in the company and holds a position worth $344.6 million.

Here is what Bronte Capital had to say about Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) in its third-quarter 2022 investor letter:

“There have been some bright spots in our long book. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN), a major position and a stock we wrote up in our June 2021 letter, has been one of the best performing stocks in the S&P 500 this year. Alas it has not been enough to offset some of our weaker stocks, let alone our overweight exposure to the UK (and Europe) which have suffered from both stock and currency weakness. We do not think we are bad at picking stocks on the long side and hope – reasonably we think – for better relative results in the future. Prior to COVID, our longs were markedly better than the index. Unfortunately, if you look at our long book this quarter and since the onset of the COVID pandemic, there is scant evidence that we have added any value by picking stocks to go long.”

3. Lam Research Corporation (NASDAQ:LRCX)

Number of Hedge Fund Holders: 56

Lam Research Corporation (NASDAQ:LRCX) is a leading manufacturer of semiconductor processing equipment. The company’s products are used in the fabrication of integrated circuits. The company has split its stock two times in history and its most recent stock split was a 3-for-1 split in March 2000. The company’s share price has skyrocketed from $45 at the time of the split to $433, as of November 9. Lam Research Corporation (NASDAQ:LRCX) is due for a stock split and ranks among the stocks that may split soon.

On October 19, Lam Research Corporation (NASDAQ:LRCX) posted earnings for the fiscal first quarter of 2023. The company reported an EPS of $10.42 and outperformed estimates by $0.88. The company generated a revenue of $5.07 billion, up 17.88% year over year, and beat expectations by $165.20 million. Shortly after the company’s earnings release, Jefferies analyst Mark Lipacis updated his price target on Lam Research Corporation (NASDAQ:LRCX) to $525 from $535 and maintained a Buy rating on the shares.

At the close of Q2 2022, 56 hedge funds were long Lam Research Corporation (NASDAQ:LRCX) and disclosed stakes of $2.66 billion in the company. As of September 30, Fisher Asset Management is the largest shareholder in the company and has a position worth $830.3 million.

Here is what Artisan Partners had to say about Lam Research Corporation (NYSE:LRCX) in its second-quarter 2022 investor letter:

“Lam is one of the world’s largest suppliers of semiconductor wafer fabrication equipment (WFE). Manufacturing semiconductors is incredibly complex with tolerances measured in nanometers. Consistent improvements in technology are necessary for manufacturers to improve the cost, functionality and volume of semiconductors. WFE manufacturers such as Lam provide the necessary machines and technology. The WFE industry is highly consolidated with only five global players holding more than two thirds of the market. Because of the value-added nature of the equipment and services, the industry is highly profitable with margins and returns on capital that most CEOs can only dream of.”

2. Booking Holdings Inc. (NASDAQ:BKNG)

Number of Hedge Fund Holders: 93

Booking Holdings Inc. (NASDAQ:BKNG) is a leader in the online travel and restaurant services industry and is trading at $1,865 a share, as of November 9. Booking Holdings Inc. (NASDAQ:BKNG) had a reverse stock split back in June 2003 which was a 1-for-6 split. Booking Holdings Inc. (NASDAQ:BKNG) is a viable candidate for a potential stock split because of the company’s leading position, strong track record of profitability and revenue growth, and mature business model. The stock ranks among the stocks that may be splitting soon.

On November 2, Booking Holdings Inc. (NASDAQ:BKNG) announced earnings for the fiscal third quarter of 2022. The company reported an EPS of $53.03 and beat estimates by $3.18. The company generated a revenue of $6.05 billion, up 29.43% year over year, and outperformed Wall Street consensus by $133.35 million.

This November, BofA analyst Justin Post raised his price target on Booking Holdings Inc. (NASDAQ:BKNG) to $2,250 from $2,200 and maintained a Buy rating on the shares. On November 3, Deutsche Bank analyst Lee Horowitz raised his price target on Booking Holdings Inc. (NASDAQ:BKNG) to $2,370 from $2.280 and reiterated a Buy rating on the shares.

At the end of Q2 2022, 93 hedge funds were eager on Booking Holdings Inc. (NASDAQ:BKNG) and disclosed stakes worth $5.45 billion in the company. Of those, Harris Associates was the leading shareholder in the company and held a position worth $1.07 billion.

Here is what RiverPark Funds had to say about Booking Holdings Inc. (NASDAQ:BKNG) in its third-quarter 2022 investor letter:

“We also bought back a small position in Booking Holdings during the quarter. Booking is the world’s leader in online travel, operating in 200 countries with brands including Booking.com, priceline.com, agoda.com, Kayak, Rentalcars.com and OpenTable. The company has been a dominant on-line travel agency for more than a decade with a high margin business model (40% EBITDA margin for 2019 and 28% for 2021) that requires limited capital expenditures, typically less than 3% of revenue, producing $4.5 billion free cash flow for 2019 and $2.5 billion for 2021 (due to the vast COVID disruption). The company has used its free cash flow for episodic acquisitions as well as to return cash to shareholders. BKNG is well positioned in travel as the largest player in online lodging bookings and the second largest player in alternative accommodations. Like all travel companies, Booking was hit hard by the pandemic, but with its high international exposure, we expect the company’s recovery to be equally strong as travel returns.”

1. Thermo Fisher Scientific Inc. (NYSE:TMO)

Number of Hedge Fund Holders: 93

Thermo Fisher Scientific Inc. (NYSE:TMO) is a leading global provider of life sciences solutions, analytical instruments, specialty diagnostics, and laboratory products and services. The company has executed three successful stock splits in its history of being public. The last stock split was a 3-for-2 split in June 1996 and the share price was around $40 at the time of the split. As of November 9, the stock is trading at $485 a share and is ranked among the stocks that may be splitting soon.

On October 26, Thermo Fisher Scientific Inc. (NYSE:TMO) posted strong earnings for the fiscal third quarter of 2022. The company reported earnings per share of $5.08 and outperformed estimates by $0.26. Thermo Fisher Scientific Inc. (NYSE:TMO) generated a revenue of $10.68 billion for the quarter, up 14.44% year over year, and beat expectations by $775.41 million.

On October 4, Evercore ISI analyst Vijay Kumar maintained an Outperform rating and his $580 price target on Thermo Fisher Scientific Inc. (NYSE:TMO). Kumar also added Thermo Fisher Scientific Inc. (NYSE:TMO) to Evercore ISI’s “TAP Outperform” list.

At the end of Q2 2022, 93 hedge funds held stakes in Thermo Fisher Scientific Inc. (NYSE:TMO). The total value of these stakes amounted to $7.81 billion. As of September 30, Fisher Asset Management is the most prominent shareholder in Thermo Fisher Scientific Inc. (NYSE:TMO) and has stakes worth $1.16 billion in the company.

Here is what Baron Funds had to say about Thermo Fisher Scientific Inc. (NYSE:TMO) in its third-quarter 2022 investor letter:

“Thermo Fisher Scientific Inc. (NYSE:TMO) is the world’s largest life sciences tools company. Shares fell due to the rotation out of life sciences tools stocks, driven by concerns about a possible global recession, foreign currency exposure, COVID-related lockdowns in China, and reduced levels of biotechnology funding. We continue to believe Thermo Fisher has a strong long-term growth outlook given a large and growing addressable market coupled with its industry-leading scale, commercial infrastructure, e-commerce platform, supply-chain capabilities, and R&D investment.”

You can also take a look at 10 Best Technology Dividend Stocks To Buy and Best Warren Buffett Stocks To Buy.

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Disclosure: None. 10 Stocks That May Be Splitting Soon is originally published on Insider Monkey.