1 Stock-Split Stock to Buy Before It Soars 63% According to a Wall Street Analyst

There's been a renaissance in the popularity of stock splits in recent years. It was a common convention in the late 1990s, but had fallen out of favor before enjoying a resurgence. This course of action is generally the result of years, or even decades, of strong business and financial results, which have driven the stock price out of reach for everyday investors.

While a forward stock split doesn't change the underlying value of the business, it does make shares more affordable for employees and retail investors, which is often the rationale management cites as the primary motivation for the split.

Historically, these top-performing stocks continue to outpace their peers. Companies that conduct stock splits generate stock price gains of 25%, on average, in the year following the announcement, compared with an average increase of 12% for the S&P 500, according to data compiled by Bank of America analyst Jared Woodard.

Let's look at one recent stock-split stock that still has plenty of upside ahead, according to Wall Street.

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A fan favorite

Netflix (NASDAQ: NFLX) shareholders have been amply rewarded for standing by the streaming pioneer. The stock has gained 833% over the past decade, which was surely a factor in management's decision to implement a 10-for-1 stock split.

The stock has taken a beating since the ill-fated decision to acquire studio and streaming assets from Warner Bros. Discovery, prompting a bidding war with Paramount Skydance. Now that Netflix has withdrawn from the bidding, the company can get back to business.

Netflix has officially announced that a sequel to its smash hit KPop Demon Hunters is in the works, as is an animated entry into the Stranger Things universe. It also released a special edition Stranger Things 25-disk box set that has fans of the show buzzing. This highlights Netflix's ability to connect with a broad assortment of viewers, attracting new subscribers and using the proceeds to acquire new content.

Furthermore, the company's ad-supported tier is gaining ground. Netflix's ad revenue grew 150% to $1.5 billion in 2025 and management "expects that business to roughly double again in 2026 to about $3 billion," according to co-CEO Greg Peters. This gives the company plenty of opportunity to add to its customer rolls.

The company's results are compelling. In the fourth quarter, Netflix generated record revenue of $12 billion, up 18% year over year, marking its fastest growth rate in five years. Its diluted earnings per share (EPS) jumped 30%, as its profit margin expanded by 230 basis points. Management expects its robust growth to continue, guiding for first-quarter revenue of $12.16 billion and EPS of $0.76, each up 15%.

Wall Street is generally optimistic about Netflix's future prospects. Of the 50 analysts who offered an opinion in March, 74% rate it a buy or strong buy. Furthermore, Wall Street's average price target on the stock is about $113, implying additional upside of 23% (as of this writing).

However, one analyst is much more bullish. Robert W. Baird analyst Vikram Kesavabhotla has a price target of $150 -- the highest among his Wall Street peers -- suggesting Netflix stock could climb as much as 63% from its current price. Now that Netflix has withdrawn from the running for Warner Bros. Discovery, the uncertainty that has been weighing on the stock has been removed. Furthermore, he is confident in the company's ability to navigate the industry it pioneered, resulting in stable revenue growth and expanding profit margins.

Netflix stock doesn't appear cheap at first glance, but looks can be deceiving. The stock currently trades at 30 times forward earnings -- well below its average multiple of 37 over the past three years. I'd submit that's a fair price to pay for a company with a distinguished track record of growth, reliable execution, and significant opportunity ahead.

That's why Netflix is a buy.

Bank of America is an advertising partner of Motley Fool Money. Danny Vena, CPA has positions in Netflix. The Motley Fool has positions in and recommends Netflix and Warner Bros. Discovery. The Motley Fool has a disclosure policy.