Many high-flying stocks have nosedived over the past week, and stock splits are no longer in the spotlight. There have been some AI stock splits in the past two years as they delivered explosive gains and had to split their stocks to keep them appealing. The market was rallying until very recently, so some candidates are still worth betting on.
Even if the market goes down from here, management could still do a stock split to aid a recovery. Still, stock splits generally happen less during downturns. Historical data shows fewer stock splits during downturns and a higher volume of stock splits during bull markets.
They’ve also gotten less common as retail investors can easily buy fractions through online brokers. Institutional investors can afford to buy whole shares even if they are high since they trade with larger amounts.
Regardless, it’s worth looking into some stock split candidates in case we see an improvement in sentiment. Here are two that are “sure” stock splits in my eyes if 2025 turns out to be a good year.
24/7 Wall St. Key Points:
- The broader market sentiment has remained bearish, and stock splits are not that trendy.
- However, some companies still remain well-positioned to do stock splits.
- They have continued trending upwards, and management could soon be forced to announce a stock split. In the meantime, grab our free “The Next NVIDIA” report. It includes a software stock with 10X potential.
AutoZone (AZO)
AutoZone (NYSE:AZO) is the largest retailer of automotive replacement parts in the U.S. The rest of the market has cooled down, but AZO has continued to climb up. It has delivered steady and solid gains over the past five years and is up 230%.
The megatrends are in this company’s favor. The company is geared towards DIY customers or individuals who are repairing their customer vehicles. 70% of its revenue is derived from them, and the remaining 30% comes from repair shops and garages. I’m bullish because the average age of vehicles is hitting record highs and is expected to continue increasing.
The U.S. has an aging civilian vehicle fleet that should fuel plenty of demand for AutoZone, bull market or not. The average passenger car was 14 years old in 2024, and older vehicles are expected to dominate the streets in the coming years.
This is good news for AutoZone, as people consistently need to repair their cars. Even if there’s a recession, it will indirectly benefit AutoZone as car owners are more likely to repair instead of buying a new car, which would probably come with a higher insurance premium. And if Trump’s tariffs stick around, new cars will get even more expensive.
Back to the stock itself, it’ll cost you over $3,500 to grab a whole share. This makes it one of the most expensive stocks in the market. Sooner or later, management will have to split the stock as AutoZone has shown no signs of slowing down.
Autozone targets 19 new mega-hubs and 100 international stores this year, and while its Q2 2025 earnings missed both the top line and the bottom line in slim amounts, the long-term performance is too compelling to ignore.
There has been a flurry of price target increases today. UBS raised its price target to $4,025, and TD Cowen raised it to $3,900. Raymond James and Jefferies both raised their price targets to $4,000. This implies up to 15% upside potential from its current price.
MercadoLibre (MELI)
MercadoLibre (NASDAQ:MELI) is the Amazon of Latin America. It has made a stellar recovery from the late 2021-2022 selloffs and has recovered from troughs of around $630 to over $2,073.
The price tag now looks prohibitively expensive to certain investors and may prompt a stock split this year if the rally continues. MercadoLibre was rejected twice at this level in early and late 2021. It has now broken above this level and seems to be comfortably above it.
Its fundamentals are solid, so there’s a good chance that MELI stock will keep climbing. In Q4 2024, it posted 37.42% in revenue growth to $6.06 billion, and net income grew 287.3% to $639 million. It is a very stable business with relatively predictable earnings.
It beat revenue estimates every quarter in the past year Analysts now expect stellar revenue growth over the coming decade. 2025 revenue is expected to grow 24.4% to $25.85 billion and grow at around 15-20% on average through 2030.
EPS is expected to be even more stellar. Analysts expect $46.3 in 2025 EPS, up 22.87%. It is expected to grow well over 30% on average this decade and reach $372.46 in 2034. These long-term estimates are quite speculative, but the business has executed very well so far, and it’s not a stretch for it to be able to continue that trend.
Back to its stock, analysts are almost universally bullish. They’re more than willing to pay the premium due to the fundamentals. The consensus price target of $2,402.81 implies 16.08% upside.
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