Stock Split Watch: Are These 2 Unstoppable Stocks Next?

Ladies and gentlemen, buckle up! We're diving headfirst into the world of stock splits, and today, we're zeroing in on two titans: Netflix (NFLX) and Costco (COST). These companies are on the brink of something big, and you don't want to miss out on the action. Let's break it down!

Netflix: The Streaming Giant on the Verge

Netflix is trading at a whopping $972 per share, and it's just a stone's throw away from the $1,000 mark. Historically, when a stock hits these heights, it's time for a split. Netflix has done this before—twice, in fact. In 2004, they had a 2-for-1 split, and in 2015, a 7-for-1 split at around $700. With the stock price soaring, another split seems inevitable.

But why does this matter? A stock split makes the shares more affordable, attracting a broader range of investors. Think about it: a $972 share price can be intimidating, but if it splits to $486, suddenly it's within reach for more people. This increased demand can drive the stock price even higher. It's a win-win!

Costco: The Warehouse King Ready to Expand

Costco is another powerhouse, currently trading around $955. This stock has been on a tear, and analysts are buzzing about a potential split. Oppenheimer and Jefferies have price targets up to $1,145, and the consensus is at $1,013. This is a company that knows how to grow—Q1 2025 revenue rose 7.5% year-over-year to $61 billion, and they've got 30 new warehouses in the pipeline.



A stock split for Costco would make it more accessible to retail investors, who might find the current price too high. This increased appeal could lead to higher trading volumes and potentially drive up the stock price. It's a no-brainer!

The Psychology of Stock Splits

Stock splits are more than just a numbers game. They're a psychological boost for investors. A lower share price makes the stock seem more affordable and attractive. It's like when a high-end restaurant drops its prices—suddenly, more people can afford to dine there, and the place gets busier. The same principle applies to stocks.

The Risks and Rewards

Now, let's talk about the risks. Netflix is trading at 39 times forward earnings and 9.4 times forward sales. That's steep, but the growth potential is there. Costco, on the other hand, has strong fundamentals, but there's always the risk of contract negotiations going south. Remember, the market hates uncertainty!

But the rewards? They could be massive. Increased liquidity, tighter bid-ask spreads, and a broader investor base—these are all benefits of a stock split. And let's not forget the psychological boost. A lower share price can make the stock seem more attractive, driving up demand and the stock price.

The Bottom Line

So, are Netflix and Costco the next big things in stock splits? You bet they are! These companies are on the verge of something big, and you don't want to miss out. Do your research, stay informed, and get ready to act when the time comes. This is your chance to be part of the next big wave in the market. Don't let it pass you by!