Top Stock Picks with High Potential for Growth

The stock market has been on a rollercoaster ride in recent years, with unpredictable ups and downs. When investors are faced with uncertainty, they often turn to established companies with a history of success. While the “FAANG stocks” have been a popular choice for many investors, companies that have recently undergone stock splits have been attracting even more attention.

A stock split is a cosmetic change that allows a company to adjust its share price and outstanding share count. It does not impact the company’s market cap or performance. There are two types of stock splits: forward and reverse. Forward splits make shares more affordable for everyday investors, while reverse splits increase a company’s share price to meet listing standards.

Since the beginning of 2024, several high-profile companies have announced forward stock splits. Based on optimistic price targets from Wall Street analysts, here are three stock-split stocks that could see significant gains in the next year:

Nvidia: With an implied upside of 29%, Nvidia is a leading player in the artificial intelligence industry. The company recently completed a 10-for-1 forward split and is expected to benefit from the increasing demand for AI-accelerated data centers.

Sony Group: Sony announced a 5-for-1 forward split and could see a 26% increase in its stock price over the next year. The company’s growth in gaming services and image sensors, along with a share repurchase program, are driving optimism among investors.

Lam Research: Lam Research approved a 10-for-1 forward split and could see a 30% increase in its share price over the coming year. The company’s ties to artificial intelligence and a share repurchase program are key factors driving its growth potential.

While these companies have promising outlooks, investors should also consider potential risks, such as increased competition and regulatory challenges. It’s important to carefully evaluate each investment opportunity before making a decision.

*The Motley Fool Stock Advisor team has identified the 10 best stocks for investors to buy now, but Nvidia is not one of them. Consider exploring other stock options that could offer significant returns in the future.*

**Disclosure: This article was originally published by The Motley Fool. The Motley Fool has positions in and recommends Bank of America, Lam Research, and Nvidia.**

*Bank of America is an advertising partner of The Ascent, a Motley Fool company. Sean Williams has positions in Bank of America. The Motley Fool has a disclosure policy.*