Stock splits don't change fundamentals or company value; they do a lot for investors, ultimately driving equity gains. At face value, a stock split signals underlying company strength: the stock is trending higher at “unreasonably” high price levels and is expected to continue rising, as only fundamentally strong companies can.
Digging deeper, stock splits increase affordability, even if only psychologically, opening shares to a wider audience, specifically retail traders, who drive a lot of the day-to-day price action. Most importantly, stocks that split signal managerial confidence in future results and tend to keep trending higher because the fundamental drivers remain intact.
AutoZone’s Buybacks and High Share Price Strengthen the Split Case
Autozone (NYSE: AZO) is on track for a historic split, as its share price trades above $2,800 per share, making it one of the most expensive stocks on the market. Additionally, AutoZone hasn’t split its stock in more than three decades, while competitors such as O’Reilly Automotive (NASDAQ: ORLY) have taken a different approach, with O’Reilly completing a 15-for-1 split in 2025. Key stock drivers include a steadily growing store count, persistent comp store growth, and the cash flow it enables, as AutoZone is committed to aggressive share buybacks.
Buybacks are the driver, no pun intended. AutoZone has hurdles, as do all retailers, but its position and market, including market dynamics that keep drivers in vehicles longer each year, sustain a healthy cash flow. The company allocates capital strategically, reinvesting in growth, maintaining balance sheet health, and using the remainder to buy back shares. Buybacks are significant, reducing the share count by 2.2% year over year in fiscal 2026, a pace that could continue under its existing repurchase authorization.
Eli Lilly’s Growth Story Makes a Stock Split Easier to Imagine
Eli Lilly (NYSE: LLY) is another potential split candidate because surging GLP-1 revenues and a product pipeline have kept its stock price consistently above $900, which could continue under its existing repurchase authorization. Like AutoZone, it too hasn’t split shares in decades, not since 1997, while many of its competitors have done so. Novo Nordisk (NYSE: NVO), notably, which ushered in the GLP-1 craze, is among those that have split, doubling its share count in 2023, just after the craze reached its crescendo.
Analysts' trends align with an outlook for higher share prices, if not a split. The group is increasing coverage, firming sentiment, and raising price targets, with the consensus up about 40% year-over-year (YOY) and the high end pegged at $1,600. Consensus alone is enough to set a new all-time high and extend the stock's uptrend, while the high end suggests another 35% upside remains. Looking ahead, analysts' trends could strengthen as LLY’s pipeline includes advanced GLP products with the potential to outperform its already industry-leading treatments.
Meta Remains the Magnificent Seven’s Stock-Split Holdout
Meta Platforms (NASDAQ: META) stock price surged in September, confirming its uptrend and potential to continue higher. The move pushed the market above $700 and strengthened the stock-split case, with expectations for higher prices ahead. A recent catalyst has been Muse AI, an agentic assistant that moves from chat-based assistance to real help, running in the background on a virtual machine and accomplishing tasks while users are offline. Factors that increase suspense include Meta’s Magnificent Seven (Mag 7) status and the fact that it remains the only Mag 7 stock that has never undergone a split. However, CFO Susan Li said at Meta's May shareholder meeting that the company did not presently plan to initiate a stock split.
Analysts are responding as well. MarketBeat tracks numerous September upgrades and price-target revisions, reversing an earlier cooling trend and pushing price action back toward the high end. The question is whether Meta can capitalize on and monetize the technology, and early adoption is encouraging. Muse reached No. 1 on Apple's (NASDAQ: AAPL) App Store and Google Play, operated by Alphabet (NASDAQ: GOOGL), giving Meta early evidence of consumer traction.
Costco’s Split Case Builds Alongside Special-Dividend Speculation
Costco (NASDAQ: COST) has a history of splits, but it's been more than 25 years since the last one. Since then, the share price has climbed to above $900 while the current analyst consensus target sits about $1,000. Over the past two years, the stock has consolidated, allowing the long-term 150-week exponential moving average to catch up to the price. It now provides support and has recently helped define the lower end of the stock's trading range. Costco could also be in a position for another special dividend, but that remains speculative.
This year’s catalysts include warehouse expansion, digital, and international markets. The company targets at least 30 new warehouse openings per year, focusing on higher-growth international markets with solid renewal rates while utilizing digital to improve internal, customer-facing, and supply chain operations. Analysts moderated targets earlier this year but reflect confidence in the consensus, with the current consensus price target near $1,046, implying roughly 13% upside from late-September levels.
The article "4 Stocks That Could Split Next—and Why Investors Are Watching" first appeared on MarketBeat.
