2024 has been marked by significant stock splits, and one of the standout companies to undergo this transformation is semiconductor giant Nvidia (NASDAQ: NVDA). Now, an artificial intelligence (AI) tool has provided insights into which split stocks may present immediate investment opportunities.
Stock splits make shares more affordable for retail investors, particularly those who cannot afford higher-priced stocks. As a result, increased accessibility to these stocks tends to drive higher demand, potentially boosting the stock’s liquidity.
To determine which split stocks from 2024 are worth buying before a possible rally, Finbold turned to OpenAI’s ChatGPT-4o.
Lam Research (NASDAQ: LRCX)
The AI tool recognizes Lam Research (NASDAQ: LRCX) as a leader in semiconductor equipment. The stock is likely to experience stronger demand due to the growing need for AI and memory chips, which have applications in cloud computing and automotive technology.
According to ChatGPT-4o, LRCX has demonstrated consistent revenue growth, high-profit margins, and strong free cash flow. These resources provide opportunities for further product research, as well as shareholder returns through dividends and buybacks. The company’s recent earnings in Q3 2024 exceeded expectations, further supporting this outlook.
For the quarter ending in September, Lam Research recorded $4.17 billion in revenue, a nearly 20% year-over-year increase. Net income also rose by 25% year over year, reaching $1.12 billion.
Impressively, these results came at a time when analysts were lowering their price targets for LRCX, mostly due to concerns about slowing growth.
In early October, Lam Research announced a 10-for-1 stock split and increased its authorized shares. As of now, the stock is trading at $77.10 with 2% gains in the past 24 hours. On the weekly chart, LRCX has increased by over 5%.
Meanwhile, a consensus of Wall Street analysts is predicting further upside for LRCX in the next 12 months. The 20 analysts forecast a nearly 30% surge, with the stock reaching $99 next year and a ‘Strong Buy’ rating.
Super Micro Computer (NASDAQ: SMCI)
Super Micro Computer (NASDAQ: SMCI), another beneficiary of the thriving AI sector, announced a 10-for-1 forward split of its common stock on October 1. According to ChatGPT-4o, the stock presents an opportunity due to its ability to meet the needs of cloud and data center operators, positioning it well in a growing niche in addition to the AI scene.
The AI model also highlights SMCI’s impressive earnings and revenue growth, which saw a substantial 142% year-over-year spike in Q2 2024, reaching $5.31 billion.
The company’s competitive edge stems from its flexibility in addressing unique customer requirements and offering cost-effective products.
Despite recent headwinds related to concerns over filing its 10-K report for fiscal year 2024 (FY2024), ChatGPT-4o remains bullish on SMCI. The company cited the need for additional time to complete an assessment of its internal controls over financial reporting.
Currently, the stock is trading at $49 with daily gains of 3.5%. On the weekly chart, SMCI has increased by 8.65%.
Finbold reports that SMCI’s role in the AI space is likely to see further growth, with AI tools projecting that the stock will trade above $60 by the end of 2024.
In summary, the stock splits of Lam Research and Super Micro Computer in 2024 present opportunities for investors. At their current valuations, they offer favorable entry points, making them compelling choices for those looking to capitalize on potential future rallies.
Featured image:
SkazovD – October 29, 2024. Digital Image. Shutterstock.
