Stock splits have become increasingly prevalent on Wall Street this year. These maneuvers are often adopted by companies after experiencing robust financial performance, causing their stock prices to become too high for some smaller investors to access. While stock splits are essentially symbolic changes, they can facilitate share purchase accessibility for employees and retail investors, a commonly cited rationale by management.
An important aspect for investors to consider is the performance leading up to a stock split. Typically, strong businesses maintain their momentum, offering continued growth prospects for investors. Let’s delve into three companies that are expected to witness further growth, according to select Wall Street analysts.
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Nvidia: Poised for a 56% Price-Target Increase
Nvidia (NASDAQ: NVDA) has long been the dominant player in the graphics processing units (GPUs) market, powering various sectors such as video games, cloud computing, and data centers. The emergence of generative artificial intelligence (AI) in early 2023 propelled demand for Nvidia’s high-end chips, further solidifying its market position.
Nvidia’s GPUs provide the computational power needed for training and running complex AI systems, driving a surge in sales. In the fiscal 2025 first quarter, the company reported a 262% year-over-year revenue increase to a record $26 billion, with a 629% jump in earnings per share to $5.98. Particularly, revenue from its data center segment, inclusive of AI processors, soared by 427% to $22.6 billion.
Despite Nvidia’s stock rising over 200% in the past year, a recent 10-for-1 stock split has sparked enthusiasm among investors. Some analysts remain exceptionally optimistic about the company’s future, with Rosenblatt’s Hans Mosesmann setting a $200 price target, indicating a 56% upside from the recent closing price.
Celsius Holdings: Projected 75% Price-Target Upside
Celsius Holdings (NASDAQ: CELH) focuses on providing healthier alternatives in the energy drinks market and has swiftly become the third-largest brand in the industry. The company executed a 3-for-1 stock split last year after a period of robust growth.
Amid challenges faced by competitors such as Red Bull and Monster Beverage, Celsius continues to gain market share, capturing 47% of the energy drink category’s growth in the first quarter. Despite a contraction in the broader beverage sector over the past three years, the energy drink segment, led by Celsius, has maintained an upward trajectory.
In the first quarter, Celsius reported a 37% year-over-year revenue increase to $356 million, accompanied by a remarkable 108% surge in diluted EPS. Although the stock recently experienced a 23% decline due to growth concerns, some analysts perceive this as a buying opportunity, with Jefferies analyst Kaumil Gajrawala setting a $98 price target, representing a 75% upside.
Sirius XM Holdings: Forecasted 100% Price-Target Upside
Sirius XM Holdings (NASDAQ: SIRI) dominates the satellite radio market in North America, boasting 34 million paid subscribers and a whopping 150 million total listeners when combining its ad-supported Pandora music streaming service, a reach unparalleled by its competitors.
The challenging macroeconomic environment in recent years, including elevated inflation, has weighed on Sirius XM’s stock, leading to a 41% decline in 2024. Moreover, investors have reacted negatively to the impending third-quarter merger of Sirius XM with Liberty Sirius XM (NASDAQ: LSXMA), its tracking stock, and the subsequent reverse stock split. While reverse stock splits typically signal challenges, in this case, it is a necessary step for the forthcoming acquisition, consolidating all shareholders under a single entity.
Considering Sirius XM’s first-quarter performance, revenue continued to
Sirius XM Financial Outlook: A Bullish Perspective
The latest financial report from Sirius XM showcased a 1% year-over-year increase in revenue to $2.16 billion, coupled with a notable 17% jump in earnings per share to $0.07. This growth was primarily driven by a surge in ad revenue, reflecting a broader recovery in the advertising sector. Despite facing a nearly 2% decline in paid subscribers, the impact was mitigated by a rise in the average revenue generated per subscriber.
An Analyst’s Optimism
Amidst a recent 27% downturn in the stock’s performance, optimism remains palpable among some Wall Street analysts. Notably, Benchmark’s Matthew Harrigan stands at the forefront of the bullish camp on Sirius XM, assigning a buy rating and setting a price target of $6.50 for the stock. This target signifies a substantial 100% surge from Monday’s closing price. Harrigan emphasizes a perceived market disconnection in anticipation of Sirius XM’s impending merger with Liberty Sirius XM. Additionally, he points to a series of strategic endeavors undertaken by the management team, foreseeing potential growth catalysts.
This disparity between the company’s operations and its current valuation has raised eyebrows. Sirius XM is presently trading at less than 10 times earnings, indicating a muted growth outlook. However, with the U.S. economy showing signs of improvement, Sirius XM’s growth trajectory is poised to escalate, potentially triggering a robust rally in its stock price.
Investment Considerations
Before making any investment decisions regarding Sirius XM, it is crucial to weigh the ongoing developments and market sentiments. While the company has demonstrated resilience and potential for growth, external factors such as market volatility and economic conditions must be taken into account.
The current market dynamics present an intriguing opportunity for investors to delve into Sirius XM’s stock. As the company navigates through industry challenges and capitalizes on strategic initiatives, the potential for long-term returns could be significant.