Are MKL, BKNG, EQIX, ORLY & ASML going for next stock splits?

Highlights

• Markel Corporation (MKL) shares soared around three times in the last decade.
• Booking Holdings (BKNG) is the parent company of Priceline and Booking.com.
• Equinix Inc. (EQIX) did a 1-for-32 reverse split in 2002 to reduce its outstanding shares to promote individual share value.

A few of the top global companies have issued stock splits in recent times, and analysts foresee many others are waiting to split shares.

Companies usually go for stock splits after a dream run of success with strong returns. Amazon, Facebook, Tesla, and Google parent Alphabet are a few top companies that went for stock splits recently.

Here, we look at five companies on the radar of analysts who predict the likelihood of them issuing the next stock splits:

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Markel Corporation (MKL)

Markel Corp. (MKL), the reputed insurance underwriter company, is a tentative candidate for a stock split, although it hasn’t done so in the past. However, its shares soared around three times in the last decade.

Analysts predict good profitability for Markel investors due to the company’s growing revenue, strengthening insurance pricing, and sizable non-insurance revenue.

MKL has a tremendous track record of top-class underwriting profitability and premium growth rates over its peers. Analysts predict positive revenue growth for 2022. The stock was trading at US$1475.24 on Thursday. The price of MKL shares rose 25.71% in the past year.  

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Booking Holdings Inc. (BKNG)

Booking Holdings is another company regarded as a top candidate for a stock split by analysts. It is the parent company of two marque travel companies - Priceline and Booking.com. 

Booking shares have shot up more than three times in the last 10 years, resulting in its stock price rising to US$2,348.36 per share as of 31 March 2022. Priceline had split its stock during the dot-com bust in 1998.

Experts believe that since more COVID travel restrictions are being eased by the day, more bookings are anticipated in the year ahead. Analysts take a positive view of the BKNG stock, which remained almost stable around the flatline over the past year.

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Equinix Inc. (EQIX)

It is a global data center company and the largest one at that. Equinix has one of the highest share prices in the market and may go for a split stock soon. Its shares have gone up by over 400% in the last 10 years to US$741.62.

Earlier, Equinix did a 1-for-32 reverse split in 2002, which means it reduced its outstanding shares to promote individual share value.

Experts believe that Equinix is a unique real estate investment trust with a significant potential to scale its business worldwide. Market connoisseurs project a high revenue growth for Equinix in 2022. The EQIX price increased by 9.38% over the last year.

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Source: Pixabay

O'Reilly Automotive Inc. (ORLY)

Auto parts company O'Reilly Automotive is another favorite of market analysts for a stock split probable. Its share climbed 647% in the last 10 years, which is a strong indication of ORLY going for a stock split. The current share price of the company is US$684.96. O'Reilly went for a 2-for-1 stock split in 2005.

According to market experts, O'Reilly will likely garner above-average revenue and earnings growth in the next few years. ORLY has captured market share in a fragmented industry by hitting both commercial and retail customers. A strong used car market and an increasing average road vehicle age are indeed tailwinds for auto parts makers, as indicated by the ORLY stock’s rise of 34.88 % since last year.

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ASML Holding NV (ASML)

It is a semiconductor manufacturing company of repute that has already issued four stock splits before 2012. Shares of ASML grew by approximately 236% in just three years, taking its stock price to US$681.92. Like other semiconductor manufacturers, the company had to invest in building additional capacity to address a global shortage of semiconductors. Analysts say that investment is a near-term tailwind for ASML, which will continue throughout this year.

Many believe that in the long run, upgrades to support 5G networks and high-power computer applications will create more demand for ASML. ASML stock price has increased by 7.25% since last year.

So, these are the five likely companies that might decide to announce stock splits, predicted by market observers and experts.

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Bottom line:

Usually, companies go for stock splits for the ease of their investors by lowering their trading price to a range that is affordable to most of them. Another reason companies decide on a spit is that the higher number of shares outstanding translates into greater liquidity of the stock.