Stock Splits Revisited: Here's How 3 High-Profile Stocks Have Performed Since Their Splits.

Few things stoke more investor interest than a stock split. While they don't alter any of a stock's fundamentals like revenue, net income, or free cash flow, splits can create buzz around a stock, bolstering existing momentum or reviving its appeal among the investment community.

Yet, there is no sure thing when it comes to the stock market, and not all stocks that undergo a split see big returns. Here, three Motley Fool contributors will review how three high-profile stocks have performed since their most recent splits: Broadcom (NASDAQ: AVGO), Palo Alto Networks (NASDAQ: PANW), and Nvidia (NASDAQ: NVDA).

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Since its split, Nvidia's stock has been stuck in neutral

Jake Lerch (Nvidia): It's been nearly a year since Nvidia completed its most recent stock split on June 10, 2024. On that date, the company split its shares 10-for-1, granting each existing shareholder 10 shares for every one share they had owned prior to the split.

Since then, Nvidia's stock has essentially moved sideways. However, there have been significant ups and downs. The stock has fallen by as much as 22% at its lowest point (a few weeks ago in early April 2025). It's also experienced a few big rallies, most notably during the last few months of 2024, when shares were up by as much as 24%.

Yet, there is a lesson to be gleaned from this meandering price action: Stock prices and fundamentals don't always move in lockstep.

Indeed, Nvidia's fundamentals have soared compared to one year ago:

• Revenue has increased by 36%
• Net income is up 37%
• Diluted earnings per share (EPS) have grown by 38%

In short, the company is posting excellent results, highlighting Nvidia's predominant role within the booming artificial intelligence (AI) sector.

Thanks to those fantastic EPS figures, Nvidia stock now trades at a price-to-earnings (P/E) multiple of 40x. While that's still high for the average stock, it's one of the lowest multiples for Nvidia over the last five years. In fact, the average P/E ratio for the stock over that five-year period is around 80x.

NVDA PE Ratio data by YCharts.

So, while Nvidia's stock performance since its most recent stock split might appear to be more of a fizzle than a sizzle, remember, fundamentals tell the true story of a company's performance. On that front, Nvidia remains a solid performer.

Nvidia wasn't the only stock to split due to AI-driven gains

Will Healy (Broadcom): Another stock to benefit significantly from AI is Broadcom.

The semiconductor and software giant became a leader in AI as it applied that technology to hardware and applications that serve businesses.

In June 2024, AI-driven gains had taken Broadcom to a pre-split price of around $1,500 per share. That prompted the company to announce its first-ever stock split, splitting its shares on a 10-for-1 basis.

When that split occurred on July 15, 2024, the split and the rising stock price led to a price of $169.89 per share. As of this writing, it has made gains of approximately 18% in the 10 months since the split.

Despite that increase, the path higher was not smooth. It peaked in early February at an intraday high of $251.88 per share. However, it got caught in a generalized sell-off in AI stocks and lost as much as 45% of its value over the next two months. Fortunately for Broadcom bulls, the stock has trended higher since that time and is now approximately 20% off its 52-week high, leaving it in a bear market.

The gains are likely not done yet. Admittedly, the P/E ratio of 97 implies that it is a pricey stock. Nonetheless, a deeper look at its valuation places its forward P/E at 30, which appears inexpensive for a top AI stock, particularly with its growth likely to continue. Analysts forecast that profits will grow by 36% this year.

The 2026 prediction calls for 19% earnings growth. While the slowing growth rate could delay the recovery of Broadcom stock in the near term, the falling valuation should bode well for its long-term bull case post-split.

A stock split couldn't keep Palo Alto Networks' rally alive

Justin Pope (Palo Alto Networks): Cybersecurity is one of the hottest growth themes in the technology sector. Palo Alto Networks, a standout for its firewall security, surged 181% between the start of 2023 and when management announced a 2-for-1 stock split on Nov. 20, 2024. The stock price was approaching $400 at that time.

Stock splits lower share prices by increasing the total share count. Splits can make a stock easier to buy or sell for individual investors or employees who may want to cash out shares they've earned. Importantly, the share count increases proportionately, so the valuation, measured by the price-to-earnings ratio, price-to-sales ratio, or any other metric you choose, doesn't change.

Still, investors tend to applaud stock splits. Unfortunately, Palo Alto Networks hasn't performed very well following the split. The stock is down by approximately 7% since it began trading at its split-adjusted share price on Dec. 16, 2024.

Companies tend to conduct stock splits when things are going well, so why has the stock languished? For starters, the market has become increasingly volatile in recent months amid geopolitical conflicts, recession worries, and a trade war between the United States and China.

Plus, Palo Alto Networks had become quite expensive following its nearly two-year run into the end of last year. Shares still trade at a hefty 58 times 2025 earnings estimates, which isn't exactly a bargain for a business that analysts estimate will grow earnings by an average of 19% annually over the long term. Patient investors should do well over the next five-plus years if the company can sustain double-digit growth, but overpaying for stocks can stunt short-term returns.

The take-home message? Stock splits should never be the sole reason an investor buys a stock.

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Jake Lerch has positions in Nvidia. Justin Pope has no position in any of the stocks mentioned. Will Healy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool recommends Broadcom and Palo Alto Networks. The Motley Fool has a disclosure policy.