Nvidia, a leading provider of processors used for AI, has experienced unprecedented growth, with revenue growing 262% year over year in the first quarter of its fiscal 2025 year. The company’s earnings per share soared 629%, marking the fourth consecutive quarter of triple-digit sales and earnings growth, pushing Nvidia’s share price up 650% since 2023. Following this success, Nvidia announced a 10 for 1 Stock Split to make stock ownership more accessible to employees and investors.
Broadcom, another major player in the semiconductor industry, is also poised for growth and potential stock split. The company offers a wide range of products used in various industries, including data centers, cloud computing, networking, broadband, wireless, and artificial intelligence. Despite facing challenges in the wireless communications sector, Broadcom’s overall business is accelerating, with revenue increasing 34% year over year in the first quarter and management expecting full-year revenue to reach $50 billion.
With strong operational and financial performance, Broadcom is a strong stock split candidate, as its share price has climbed significantly in recent years. The company’s position in the AI ecosystem and its potential to benefit from the data center market’s growth make it an attractive opportunity for investors. Additionally, the rapid adoption of AI and the revenue potential it represents further enhance Broadcom’s outlook for the future.
Broadcom’s valuation at approximately 28 times forward earnings is only slightly higher than the S&P 500 multiple of 27, despite delivering almost 10 times the returns of the index over the past decade. The company’s significant growth potential, combined with its solid position in the AI ecosystem, underscores why Broadcom could be a compelling investment opportunity, even without a stock split.
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https://www.fool.com/investing/2024/06/07/on-the-heels-of-nvidias-10-for-1-stock-split-this/
