2024 has witnessed notable stock splits, with one of the standout names being semiconductor giant Nvidia (NASDAQ: NVDA). Now, an artificial intelligence (AI) tool has offered insights into which equities that underwent a split might present an immediate investment opportunity.
Stock splits make shares more affordable for retail investors, especially those who can’t afford high-priced equities. Therefore, the increased accessibility to such stocks tends to drive higher demand, possibly boosting the stock’s liquidity.
In this context, Finbold consulted OpenAI’s ChatGPT-4o to determine which stocks that underwent a split in 2024 are worth buying now before a possible rally.
Picks for you
Lam Research (NASDAQ: LRCX)
The AI tool acknowledged that Lam Research (NASDAQ: LRCX) is a leader in semiconductor equipment. The stock will likely see stronger demand tied to the growing need for AI and memory chips with use cases in cloud computing and automotive technology.
According to ChatGPT-4o, LRCX has shown consistent revenue growth, high-profit margins, and strong free cash flow.
These resources provide means for further product research, and shareholder returns through dividends and buybacks. The firm’s recent stronger-than-expected earnings back this element for Q3 2024.
For the quarter ending September, the company recorded revenue of $4.17 billion, an almost 20% year-over-year surge. On the other hand, net income came in at $1.12 billion, up 25% year over year.
Indeed, these impressive results came when analysts lowered their price targets for LRCX. Most of their outlook was inspired by concerns regarding slowing growth.
In early October, Lam Research announced a 10-for-1 stock split and increased its authorized shares. By press time, the equity was trading at $77.10 with 24-hour gains of 2%, while on the weekly chart, LRCX was up over 5%.
Meanwhile, a consensus of Wall Street analysts is forecasting more upside for LRCX in the next 12 months. The 20 analysts predict the equity will surge almost 30% to hit $99 next year with a ‘Strong Buy’ rating.
Super Micro Computer (NASDAQ: SMCI)
Super Micro Computer ((NASDAQ: SMCI), another beneficiary of the booming 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 serve the needs of cloud and data center operators, positioning it well in a growing niche in addition to the AI scene.
Additionally, the AI model pointed to SMCI’s impressive earnings and revenue growth, which surged explosively in Q2 2024, hitting $5.31 billion, a 142% YoY spike.
As per the AI model, the company’s flexibility in addressing unique customer requirements and cost-effective product offerings contributes to its competitive edge.
ChatGPT-4o remained bullish on SMCI despite the firm recently facing headwinds due to concerns raised regarding filing its 10-K report for the fiscal year 2024 (FY2024). The company cited the need for additional time to “complete an assessment of its internal controls over financial reporting.”
By press time, the stock was trading at $49 with daily gains of 3.5%, while on the weekly chart, the equity is up 8.65%.
As reported by Finbold, SMCI’s role in the AI space is likely to see more upside, with an AI tool projecting that the equity 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.
