Janice R. Andrews
This year, stock splits are very popular on Wall Street, as seen by the increasing number of corporations that are implementing them. These actions are typically conducted after a company’s stock price has risen above the grasp of certain smaller investors due to years of solid financial and operating results. Although a stock split is only a cosmetic alteration, management frequently cites this as the reason for it because it can facilitate the purchase of shares by employees and other retail investors.
Investors should place greater emphasis on the outcomes that come before a split, though. Robust companies typically maintain their profitable practices, giving investors a constant reason to purchase the stocks. Let’s look at three firms that certain Wall Street analysts believe have greater upside potential in the future.
Nvidia: 56% Price-Target Upside Is Highest
For a considerable amount of time, Nvidia (NASDAQ: NVDA) has been the clear leader in the graphics processing units (GPUs) used in data centres, cloud computing, and video games. When generative artificial intelligence (AI) emerged in early 2023 and sent demand for its top-tier chips skyrocketing, it was in a good position.
The processing capacity required to train and operate big, complex language models and other AI systems is provided by Nvidia’s GPUs, which are proving to be quite popular. Nvidia’s revenue surged 262% year over year to a record $26 billion in its fiscal 2025 first quarter, which concluded on April 28. This led to a 629% increase in the company’s earnings per share (EPS), which came to $5.98. AI-related chips had the most effect: its data centre segment’s revenue, which includes AI processors, increased by 427% to $22.6 billion.
The recent 10-for-1 stock split by Nvidia has investors’ attention. Some on Wall Street are still very optimistic, despite the fact that the stock has increased by more than 200% in the last year. Hans Mosesmann of Rosenblatt, one of the Wall Street analysts following the stock, is the company’s largest bull with a buy rating and a $200 price objective, representing a 56% increase from Monday’s closing price.
The analyst points to Nvidia’s integrated software, which powers its top-shelf performance, and the growing demand for AI chips. “We anticipate this software aspect will significantly increase in the next decade in terms of overall sales mix, with an upward bias to valuation due to sustainability,” Mosesmann stated. This implies that during the course of the next year or two, Nvidia’s market capitalisation will increase from its current level of about $3 trillion to $5 trillion.
His optimism about Nvidia is by no means unique. 53 analysts who provided feedback on the stock in June rated it as a buy or strong buy, and none of them suggested selling.
Number One: Celsius Holdings: 75% Price-Target Upside
Celsius Holdings (NASDAQ: CELH) is gaining market share in a rapidly expanding and lucrative segment by concentrating on healthier substitutes for energy drinks. After a lengthy period of strong growth, it swiftly rose through the ranks to become the third-largest energy drink brand and carried out a 3-for-1 stock split late last year.
Celsius has been gaining market share as competitors Red Bull and Monster Beverage have suffered; in the first quarter, it captured 47% of all growth in the energy drink category. Celsius has been at the forefront of the energy drink category’s growth during the last three years, despite the overall beverage industry’s decline.
Revenue increased 37% year over year to $356 million in the first quarter, while diluted EPS skyrocketed by 108%. Because of its collaboration with PepsiCo, Celsius’s sales more than doubled in 2023, making this year’s comparisons more difficult. The beverage behemoth increased Celsius’s distribution and invested $550 million for an 8.5% share.
Due to worries over decreasing growth, the stock has lost 23% of its value in the last month. On Wall Street, though, some see this collapse as a chance to purchase. Analyst Kaumil Gajrawala of Jefferies keeps the stock at a buy rating and a price objective of $98—75% over Monday’s closing value. The slower growth, according to the analyst, is “normal in year two of [a] national distribution” deal, and investors should ignore the “near-term noise.”
Number One: Sirius XM Holdings: 100% Price-Target Upside
In North America, Sirius XM Holdings (NASDAQ: SIRI) is without a doubt the dominant provider of satellite radio. It has an unparalleled audience of 34 million paying subscribers and 150 million total listeners when you include its ad-supported Pandora music streaming service.
With higher-than-normal inflation and other macroeconomic challenges over the past few years, the stock has underperformed in 2024, down 41% so far. Moreover, the impending third-quarter merger of Sirius XM with Liberty Sirius XM (NASDAQ: LSXMA), its tracking stock, and the ensuing reverse stock split are causing investors to react in an unwarranted knee-jerk manner. In this instance, a reverse stock split—which usually signals trouble—is an essential corporate move related to the impending acquisition that will unify all of the company’s stockholders under one “roof.”
Revenue increased 1% year over year to $2.16 billion in the first quarter, while EPS increased 17% to $0.07. Record ad revenue, the outcome of a continuing rebound in the larger advertising industry, drove its improved numbers. Its paid subscriber base shrank by over 2%, but the increase in average revenue per subscriber more than made up for it.
Some on Wall Street think the selloff has gone too far in the aftermath of the stock’s 27% loss over the last year. The head of the bull camp on Sirius XM is benchmark analyst Matthew Harrigan, who has a buy rating and a $6.50 price objective for the stock. That is 100% more than the closing price on Monday. Prior to its impending merger with Liberty Sirius XM, Harrigan cites a gap in the market as well as a “gaggle of strategic initiatives” that management is working on that might spur growth.
There is a comparable gap between the firm and its valuation as a result of this uncertainty. As of right now, Sirius XM is trading for less than ten times earnings, a ratio that almost certainly indicates slow future growth. However, the strengthening US economy ought to accelerate Sirius XM’s growth rate, which can spark a surge in the company’s stock price.
