Stock splits change the number of outstanding shares of a company, but not the company’s overall value. A forward split makes each share cheaper and easier to buy. Splits can range from 2-for-1 to 100-for-1 or more. In a 2-for-1 split, one share becomes two by cutting the price in half. For instance, a $100 share becomes two $50 shares. This makes shares more affordable and attracts more investors. Even though the price per share drops, the total value held by shareholders stays the same. So, splits don’t change who controls the company. The main reason for a split is to make the stock more appealing, or accessible for retail investors.
Uncertainty is Driving Selloff
Dan Suzuki, Deputy CIO at Bernstein Advisors, joined CNBC’s ‘Squawk on the Street’ on March 14 to share his perspective on the recent persistent three-week downtrend in the indexes during an interview. He explained that the sell-off is largely driven by uncertainty and its negative impact on sentiment. According to Suzuki, analyzing market movements reveals that the stocks that rallied most after the election until mid-February have seen significant declines since then and create a mirror image effect. Additionally, the most expensive and high-beta stocks have been hit hardest as the market prices are in an uncertainty risk premium. These dynamics are central to what is driving markets currently. Despite this, Suzuki noted that hard economic data remains strong and suggests that relief from headline uncertainties could reduce the risk premium.
Suzuki noted concerns over soft retail sales and spending figures, which might be due to weather or seasonal factors. However, he highlighted resilience in weekly retail sales and strong leading indicators. Prolonged uncertainty could still impact growth. Suzuki linked consumer trends to disappointing corporate guidance and persistently high inflation, which affected sentiment. He also pointed out the wealth effect caused by a stock market decline of 10% or more, particularly for investors in crowded names. Markets are adjusting to persistent uncertainty, which will continue even with relief anticipated within the next month or two, which will prevent a return to the high multiples seen in 2020-2023.
In an uncertain market with heightened risk premiums, companies considering stock splits may need to weigh the potential benefits against the backdrop of overall market sentiment. The ongoing economic uncertainty and changes in consumer behavior might impact how companies approach decisions about stock splits, especially if they are concerned about maintaining investor confidence in a volatile market. With that being said, we’re here with a list of the 12 stocks to buy that may be splitting soon.
Our Methodology
We sifted through ETFs, online rankings, and internet lists to compile a list of the top stocks that were trading over $400 as of March 17. We then selected the 20 stocks with high surges in their share prices in the past 5 years and a history of stock splits. From that, we picked the top 12 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Stocks to Buy That May Be Splitting Soon
12. Texas Pacific Land Corp. (NYSE:TPL)
Share Price as of March 17: $1,321.07
Surge in Share Price in 5 Years: 1023.17%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 28
Texas Pacific Land Corp. (NYSE:TPL) operates within the Permian Basin. It focuses on land and resource management, as well as comprehensive water services. Its core business involves managing extensive land holdings and oil and gas royalty interests, alongside providing vital water solutions to operators in the region.
The company’s Permian Basin royalty business saw a 14% year-over-year increase in oil and gas production volumes in 2024. This drove the company to record financial performance, despite fluctuating commodity prices. In Q4 2024, royalty production reached 29,100 barrels of oil equivalent per day, which was an 11% increase year-over-year. Recent acquisitions added ~1,100 barrels of oil equivalent per day to the full-year production of 26,800 barrels of oil equivalent per day. The company now sees continued growth, which is supported by a 20% year-over-year increase in new permits and a healthy inventory of drilled but uncompleted wells (DUCs).
The company’s strategic acquisitions in 2024, particularly in August and October, also boosted its production. By acquiring mineral interests and surface assets in the Midland Basin, Texas Pacific Land Corp. (NYSE:TPL) added ~1,100 barrels of oil equivalent per day to its full-year 2024 production of ~26,800 barrels. These all-cash transactions expanded its royalty acreage and surface holdings, contributed to increased production volumes and strengthened its position in the Permian Basin.
Maran Capital Management considers the company a successful investment and stated the following regarding Texas Pacific Land Corp. (NYSE:TPL) in its Q3 2024 investor letter:
“The power of a long-term horizon coupled with an aversion to risk but a tolerance for volatility is clearly evidenced by HK’s largest position, Texas Pacific Land Corporation (NYSE:TPL), which the firm or its predecessors has owned for over 30 years. TPL’s market capitalization is now greater than $25 billion, but it was a microcap when Horizon first invested. On a split and dividend-adjusted basis, TPL traded for a dollar or so3 per share in 1994, the year of HK’s founding. It recently surpassed $1,000 per share
Owning a stock that turns a few dollars into more than $1,000 (or for those keeping track at home, a few million dollars into more than $1 billion) is obviously an incredible outcome, but high levels of conviction and equanimity in the face of volatility were required to hold onto the stock. Over the course of those 30 years, TPL experienced a 70%+ drawdown, a few 50%+ drawdowns, several more 40%+ drawdowns, and numerous 30%+, 20%+, and 10%+ drawdowns. The longest drawdown lasted almost six years…”(Click here to read the full text)
11. WW Grainger Inc. (NYSE:GWW)
Share Price as of March 17: $967.82
Surge in Share Price in 5 Years: 352.72%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 49
WW Grainger Inc. (NYSE:GWW) distributes maintenance, repair, and operating products and services across North America, Japan, and the UK. It operates through its High-Touch Solutions and Endless Assortment segments and provides industrial supplies and services. It caters to customers ranging from small businesses to large corporations through various sales and digital channels.
The company’s High-Touch Solutions segment serves large and medium-sized B2B customers. In 2024, this segment saw a 4% year-over-year sales increase in Q4 2024. This business did better than the overall market by about 1% last year. For 2025, it’s aiming to sell a lot more, between 4% and 5% more than the market, but the company expects to be at the low end of that range.
The company is heavily investing in technology and its sales force. It’s using AI and ML to improve customer service and operational efficiency. WW Grainger Inc. (NYSE:GWW) added ~70 new sellers in 2024 and is planning to add more in 2025. It’s also investing in new distribution centers to ensure that its supply chain remains robust. It’s focusing on volume-based growth for market measurement now.
ClearBridge Multi Cap Growth Strategy stated the following regarding WW Grainger Inc. (NYSE:GWW) in its first quarter 2024 investor letter:
“W.W. Grainger, Inc. (NYSE:GWW), in the industrials sector, was our largest new buy. Grainger is the biggest industrial maintenance, repair, and operations distributor in North America. The company is a share gainer in a large and fragmented market, with less than 10% share of the addressable market for their direct, “high touch solutions” business estimated at more than $165 billion. Grainger has also barely scratched the surface with its online “endless assortment” platform, Zoro.com, which targets an even larger market. In addition to its growth and profit potential, we are attracted to Grainger’s strong balance sheet and improved capital allocation under its current management.”
10. Autozone Inc. (NYSE:AZO)
Share Price as of March 17: $3,554.91
Surge in Share Price in 5 Years: 388.22%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 56
Autozone Inc. (NYSE:AZO) retails and distributes automotive replacement parts and accessories across the US, Mexico, and Brazil. It offers a range of products for vehicles, from essential maintenance items to hard parts and accessories. It caters to both DIY customers and professional mechanics through various sales channels. These include online platforms and commercial programs.
The company’s Domestic Commercial business had its sales up 7.3% year-over-year in FQ2 2025. This segment now represents 31% of domestic auto parts sales and 27% of total company sales. Each of the company’s commercial sales programs brought in an average of $14,700 in sales every week, which is a 4.3% improvement.
To fuel this growth, Autozone Inc. (NYSE:AZO) is expanding its Mega-Hub network. The company ended FQ2 with 111 Mega-Hubs and plans to add at least 19 more in the next two quarters. The company’s Mega-Hub network consists of large stores carrying over 100,000 SKUs which are designed to boost commercial sales and serve as expanded assortment sources for other stores. The company is focused on increasing its market share by attracting new commercial customers and selling more to existing ones.
The company’s leadership in the growing automotive parts market, strong customer service, and disciplined capital allocation position it for continued success. Brown Advisors Global Leaders Strategy stated the following regarding AutoZone Inc. (NYSE:AZO) in its Q4 2024 investor letter:
“AutoZone, Inc. (NYSE:AZO) is the leading replacement automotive parts retailer and distributor in the US, servicing both the Do-it-Yourself (DIY) and Do-it-for-Me (DIFM) segments of the used car market, a market that is structurally growing as the fleet expands, with a high degree of visibility into future demand of the 6+ year used car cohort, which is AutoZone’s core target market. AutoZone is expanding into the faster growing DIFM market, as well as into Brazil and Mexico. The company’s superior customer outcome is immediate parts availability and the meaningful de-risking of the balance sheets of smaller garages which do not need to hold inventory themselves. It offers a differentiated service for customers based on local availability of parts (“in stock, in market”), quick turnaround speed and advice (including free specialty tool loans so DIY customers can complete necessary maintenance at lower cost but generating enduring loyalty). All this has historically proven difficult to replicate in an e-commerce setting. While there are a small number of large companies operating in this growing market, further consolidation of smaller competitors is expected as leading retailers’ scale (depth and breadth of inventory) and network effects (proximity to customers in immediate need of repair) constitute strong moats. One of the impressive characteristics of the company’s capital allocation is that it has delivered exceptional capital discipline and deployed its cash flow into share buybacks which has reduced the company’s share count by about 85% since 2000.”
9. KLA Corp. (NASDAQ:KLAC)
Share Price as of March 17: $713.00
Surge in Share Price in 5 Years: 525.33%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 58
KLA Corp. (NASDAQ:KLAC) designs, manufactures, and markets process control and yield management solutions for the semiconductor and electronics industries. It operates across three segments that provide inspection, metrology, and process control tools, as well as wafer processing technologies. These segments serve the semiconductor, PCB, display, and packaging markets.
The company’s Process Control segment saw a 12% year-over-year revenue increase in 2024. This segment provides vital inspection tools for semiconductor manufacturing. It is driven by the demand for advanced technologies like AI and high-bandwidth memory. In 2024, advanced packaging revenue alone hit ~$500 million and is projected to exceed $800 million in 2025. This segment is crucial because it addresses the growing complexity of chip production. The company’s tools help customers manage intricate designs and larger semiconductor devices.
On January 31, Deutsche Bank raised the company’s stock target to $850 from $725, while maintaining a Buy rating. The bank cited the company’s solid revenue growth for this sentiment, which was driven by high-bandwidth memory and leading-edge spending. Analysts predict that KLA Corp. (NASDAQ:KLAC) will outperform peers due to increasing semiconductor manufacturing complexity.
KLA Corp. (NASDAQ:KLAC) is seen as a strong long-term investment despite short-term China demand concerns, due to its inherent advantages and growth potential in other regions. Parnassus Core Equity Fund stated the following regarding the company in its Q4 2024 investor letter:
“We also added several new positions, including two in Information Technology: Workday, a category leader for enterprise cloud applications for finance and human resources, and KLA Corporation (NASDAQ:KLAC), a leader in semiconductor process control. KLA, a leader in semiconductor process control, benefits from inherently high switching costs, structurally higher demand for advanced semiconductors and increasingly complex semiconductor manufacturing. The company has a strong management team that is positioning it well for long-term growth. Concerns about weaker demand in China have impacted KLA’s stock price recently, but we believe the secular growth in other regions could offset the risk in the longer term.”
8. Fair Isaac Corp. (NYSE:FICO)
Share Price as of March 17: $1,799.90
Surge in Share Price in 5 Years: 645.52%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 60
Fair Isaac Corp. (NYSE:FICO) develops analytics and digital decisioning software for businesses globally. Operating through its Scores and Software segments, it provides credit scoring solutions and a range of analytical and decision management software. This includes the FICO Platform to automate and enhance business decisions across various sectors.
Its Scores segment is a major revenue generator, especially in the B2B area. In FQ1 2025, this segment’s revenue hit $236 million, which was a 23% increase year-over-year. The B2B side saw a 30% jump largely due to mortgage origination revenues, which skyrocketed by 110%. Mortgage-related revenue made up 44% of B2B revenue and 34% of the total Scores segment.
This growth is driven by the adoption of FICO Score 10 T, which is an advanced credit scoring model designed to provide lenders with a more precise assessment of credit risk, particularly in mortgage lending. Clients using this score represent a huge amount of mortgage originations and servicing. Loans using this score are now traded on the MCT Marketplace, and a mortgage-backed security using FICO Score 10 T was created. Fair Isaac Corp. (NYSE:FICO) is innovating and working on incorporating Buy Now Pay Later data into scores and developing a mortgage simulator.
Carillon Eagle Mid Cap Growth Fund stated the following regarding Fair Isaac Corporation (NYSE:FICO) in its Q3 2024 investor letter:
“Fair Isaac Corporation (NYSE:FICO) provides predictive analytics and data management products and services that enable businesses to automate, improve and connect decisions. The stock performed well during the period as quarterly earnings were strong and guidance was lifted. The quarter was highlighted by continued pricing gains in the company’s Scores business. Additionally, expectations of increased residential mortgage activity as interest rates move lower also aided the stock.”
7. Parker-Hannifin Corp. (NYSE:PH)
Share Price as of March 17: $607.88
Surge in Share Price in 5 Years: 493.46%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 62
Parker-Hannifin Corp. (NYSE:PH) manufactures motion and control technologies. It operates through its Diversified Industrial and Aerospace Systems segments. It provides a portfolio of products and systems, from industrial components to complex aerospace solutions. It serves original equipment manufacturers and various other customers worldwide.
Its Aerospace segment is a major growth engine and had its FQ2 2025 sales hit a record $1.5 billion, which recorded a 14% year-over-year increase. This growth was entirely organic and was fueled by a 20%+ surge in the aftermarket and mid-single-digit growth in OEM markets. The full-year forecast for aerospace and defense has been raised to 11%. Aerospace orders continue to be robust, with a 9% increase year-over-year.
The segment benefits from continued strength in both aftermarket and OEM orders, and the company is seeing gradual OEM rate increases. Parker-Hannifin Corp. (NYSE:PH) is also actively using its Win strategy and Parker Lean System to drive performance and continuous improvement within the Aerospace segment. The Win strategy is an operational excellence system, while the Parker Lean System is a continuous improvement methodology.
Diamond Hill Mid Cap Strategy stated the following regarding Parker-Hannifin Corporation (NYSE:PH) in its Q3 2024 investor letter:
“Other top Q3 contributors included Parker-Hannifin Corporation (NYSE:PH) and Ciena Corporation. Diversified industrial and aerospace manufacturer Parker-Hannifin is capitalizing on strength in its aerospace business to drive better-than-expected results against a challenging macroeconomic backdrop that has weighed on peers’ results.”
6. O’Reilly Automotive Inc. (NASDAQ:ORLY)
Share Price as of March 17: $1,327.41
Surge in Share Price in 5 Years: 403.25%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 63
O’Reilly Automotive Inc. (NASDAQ:ORLY) retails and supplies automotive aftermarket parts, tools, and accessories across the US, Puerto Rico, Mexico, and Canada. It caters to both DIY and professional customers and offers a range of products and services. These include hard parts, maintenance items, and various support programs, under numerous proprietary brands.
The company’s Professional business consistently achieved mid-single-digit comparable store sales growth throughout 2024. This segment caters to professional mechanics and garages, and its strong performance is crucial to the company’s overall success. Professional ticket counts also contributed to sales growth. The company is gaining market share in the professional segment through exceptional customer service and industry-leading inventory availability. It’s strategically investing in its hub store network to enhance parts availability and expanding its distribution network to support this growth.
O’Reilly Automotive Inc. (NASDAQ:ORLY) maintains industry-leading inventory levels. The company now expects increased ticket counts due to higher industry growth rates and continued market share gains. Its focus on service and inventory positions it well for continued success in this segment.
Qualivian Investment Partners maintains O’Reilly Automotive Inc. (NASDAQ:ORLY) as a long-term core holding due to its market leadership and strong capital allocation. It stated the following regarding the company in its Q3 2024 investor letter:
“O’Reilly Automotive, Inc. (NASDAQ:ORLY): The company reported Q2 2024 revenue growth of 5% on a SSS comp of 2.3%, while EPS grew 7%, both of which missed expectations. Management as well as competitor commentary suggested slowing demand industry wide. Operating cost leverage from a growing topline was offset by wage inflationary pressures, resulting in operating margins coming down by 40 bps year-on-year. The company revised full-year guidance down for revenue, same- store-sales comp growth, and EPS to account for the miss in the quarter.
ORLY is the leader in the automotive retail parts marketplace and has outexecuted the competition, especially the smaller mom and pop auto parts stores that cater to the retail and auto mechanic shops in the US. Furthermore, its historical deployment of its excess cash to repurchase its shares continues to be a key linchpin of its ability to generate shareholder returns more than the market. While we are maintaining a watchful eye on slowing market trends, we continue to see ORLY as a long-term core holding in the fund.”
5. ASML Holding (NASDAQ:ASML)
Share Price as of March 17: $661.70
Surge in Share Price in 5 Years: 207.81%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 86
ASML Holding (NASDAQ:ASML) provides advanced lithography solutions for the semiconductor industry. It develops, manufactures, and services lithography, metrology, and inspection systems. This includes the critical extreme ultraviolet (EUV) technology, which is essential for producing cutting-edge integrated circuits.
On January 30, Argus analyst Jim Kelleher lowered the company’s price target to $1,000 from $1,250, while keeping a Buy rating. Despite the company’s record Q4 2024 revenue and earnings exceeding expectations, bookings fell 23% year-over-year. ASML Holding (NASDAQ:ASML) anticipates reduced China exposure in 2025 but expects increased demand in other major markets. EUV machines are critical for advanced chip manufacturing.
In 2024, EUV system sales reached €8.3 billion, which accounted for 44 systems, including High NA EUV. Q4 2024 alone saw €2.9 billion in EUV sales, with revenue recognized on two High NA systems. The NXE:3800E (Low NA EUV) also demonstrated strong performance. Market demand, particularly driven by AI, is fueling growth. Long-term, ASML Holding (NASDAQ:ASML) projects a 2030 revenue opportunity of €44 billion to €60 billion, with EUV systems playing a major role.
The company’s monopoly in critical lithography technology and the rising demand for advanced chips, especially for AI, position it for strong long-term growth. Baron Fifth Avenue Growth Fund stated the following regarding ASML Holding (NASDAQ:ASML) in its Q4 2024 investor letter:
“ASML Holding N.V. (NASDAQ:ASML) is a Dutch company that designs and manufactures photolithography equipment for semiconductor manufacturing. While ASML is the leader across all types of lithography, most importantly, it is the only manufacturer of extreme ultra-violet lithography tools, which are critical for the manufacturing of leading-edge chips. Shares fell 16.6% during the fourth quarter (finishing the year down 7.7%) on reduced guidance for 2025 as well as growing investor concerns about the potential impact of U.S. government restrictions on Chinese demand and the possibility of peaking lithography intensity. Despite near-term noise, we believe that the growing demand for chips in general and AI chips in particular will continue to support long-term growth for the wafer fab equipment industry with ASML’s competitive positioning remaining unassailable. While lithography as a percentage of capital expenditure may decrease from current levels, the chip layer count requiring lithography will continue to increase, in our view, as chips continue to become more complex. As a monopoly on critical lithography tools supporting an industry with growing demand fueled by the proliferation of AI, we see strong long-term upside for ASML.”
4. Costco Wholesale Corp. (NASDAQ:COST)
Share Price as of March 17: $903.92
Surge in Share Price in 5 Years: 211.25%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 96
Costco Wholesale Corp. (NASDAQ:COST) operates membership warehouses globally and offers an array of branded and private-label merchandise. It provides products ranging from groceries and electronics to apparel and home goods, alongside various services like gas stations, pharmacies, and online shopping.
Its Membership program is fundamental to its success. Paid household members reached 78.4 million in FQ2 2025, which was a 6.8% increase year-over-year. Cardholders totaled 140.6 million, which was up 6.6%. Executive memberships also grew to 36.9 million, which marked a 9.1% increase. These executive members now represent 47.1% of all paid members and contribute to 73.8% of worldwide sales.
A recent fee increase contributed about 3% to FQ2’s income, with the majority of the benefit expected in the next four quarters, peaking in FQ4 2025 and FQ1 2026. Costco Wholesale Corp. (NASDAQ:COST) maintains high renewal rates through value and service, expands executive memberships, and uses digital promotions and Asian expansion to gain new members. The end goal is to grow the membership base and improve the member experience through targeted messages and experiences.
Parnassus Core Equity Fund stated the following regarding Costco Wholesale Corporation (NASDAQ:COST) in its Q2 2024 investor letter:
“Costco Wholesale Corporation (NASDAQ:COST) posted strong results for the third quarter of fiscal 2024, with a robust increase in net sales and strength in both U.S. and international markets. Bucking the trend of weakening demand for discretionary items that has pressured many other retailers, Costco reported growth in nonfood sales.”
3. Booking Holdings Inc. (NASDAQ:BKNG)
Share Price as of March 17: $4,465.48
Surge in Share Price in 5 Years: 279.26%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 99
Booking Holdings Inc. (NASDAQ:BKNG) is a global leader in online travel and restaurant reservations. Through its prominent brands like Booking.com, Priceline, Agoda, KAYAK, and OpenTable, it provides a suite of services. These include accommodation, flight, and rental car reservations, as well as restaurant bookings and related travel solutions.
The company’s Accommodation segment, primarily Booking.com, is the core of its business. Q4 2024 saw room night growth of 13% year-over-year, while full-year 2024 growth was 9% year-over-year. Alternative accommodations experienced a 19% room night increase in Q4, with listings reaching 7.9 million. Merchant gross bookings on Booking.com hit 59% of total bookings in 2024, which was up 9% year-over-year.
The Genius loyalty program’s higher tiers (Levels 2 and 3) accounted for over 30% of active travelers, who booked a mid-50s percentage of room nights. Direct bookings represented the mid-60s percentage of B2C room nights in 2024. Booking Holdings Inc. (NASDAQ:BKNG) is implementing a transformation program to achieve $400-450 million in annual cost reductions. It’s reinvesting $170 million in strategic areas like GenAI and fintech.
Cooper Investors Global Equities Fund stated the following regarding Booking Holdings Inc. (NASDAQ:BKNG) in its Q4 2024 investor letter:
“The largest contributors to returns were Booking Holdings Inc. (NASDAQ:BKNG) and Liberty Formula One (FWONK). BKNG is the leading global travel platform (larger than Airbnb and Expedia combined on an annual room nights booked basis). Operating trends continue to be strong driven by tailwinds from global travel demand and new CFO Ewout Steenbergen finding cost efficiencies following a period of investment. This resulted in third quarter revenue growth of 9% driving Earnings Per Share growth of 16%, a run rate we believe is now sustainable for the business. BKNG has been a highly successful investment, delivering returns of 130% since our first investment in December 2022. But going forward we see less value latency and have consequently begun to redeploy capital into more compelling opportunities.”
2. Eli Lilly And Co. (NYSE:LLY)
Share Price as of March 17: $813.48
Surge in Share Price in 5 Years: 564.61%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 115
Eli Lilly And Co. (NYSE:LLY) discovers, develops, and markets human pharmaceuticals. Its portfolio includes treatments for diabetes, obesity, oncology, autoimmune diseases, and neurological conditions. It serves patients across the US and internationally through various collaborations and partnerships.
The company’s Cardiometabolic segment is driven by incretin medications and contributes majorly to the company’s growth. Full-year 2024 overall revenue for the company surged 32% year-over-year to over $4 billion above initial guidance, with Q4 2024 alone seeing a 45% increase. Mounjaro sales hit $3.5 billion in Q4, while Zepbound’s US sales reached $1.9 billion, making it the top anti-obesity drug by new prescriptions.
The company is expanding production to meet demand, aiming for a 1.6x increase in incretin salable doses in H1 2025 compared to H1 2024. It’s also advancing its pipeline, with multiple Phase III trials underway. Eli Lilly And Co. (NYSE:LLY) now forecasts 2025 revenue between $58 billion and $61 billion, which represents 32% growth. It plans to launch Mounjaro in new international markets and continue investing in R&D, with several regulatory submissions expected.
Parnassus Core Equity Fund sees Eli Lilly And Co. (NYSE:LLY) as a strong long-term investment due to its GLP-1 franchise and innovation, capitalizing on a sell-off to buy at an attractive valuation. It stated the following in its Q4 2024 investor letter:
“Eli Lilly and Company (NYSE:LLY) stock declined following worse-than-expected third quarter results for its weight-loss drug segment. We initiated our position partway through the quarter, after the drawdown and in time for a partial rebound, and our average underweight for the quarter led to a relative contribution.
In the Health Care sector, we added drugmaker Eli Lilly, which has an exceptional GLP-1 franchise and a strong track record of innovation, which position the company for long-term growth. A rare revenue miss and President-elect Trump’s health secretary nomination sparked a sell-off, providing a window of opportunity to gain exposure to the drugmaker’s attractive product suite and pipeline at an attractive valuation.”
1. Netflix Inc. (NASDAQ:NFLX)
Share Price as of March 17: $918.00
Surge in Share Price in 5 Years: 175.82%
Stock Split Confirmed: No
Number of Hedge Fund Holders: 144
Netflix Inc. (NASDAQ:NFLX) is a global entertainment streaming service. It operates in about 190 countries and offers a diverse library of TV series, documentaries, feature films, and games. These are accessible across various internet-connected devices.
The company’s subscriber growth is its primary revenue driver. It added 19 million subscribers in Q4 2024. This growth was from big events, as well as from a range of content across all regions. The majority of new subscribers came from the company’s diverse content library, not single titles. It focuses on original series, films, live sports, and games. Live sports, like NFL games, drew 30-31 million viewers, and WWE Raw had 5 million views in its first week. It’s also expanding into games, with titles like “Squid Game: Unleashed” becoming top downloads.
Netflix Inc. (NASDAQ:NFLX) offers ad-supported plans, which now account for over 55% of sign-ups in ad-supported regions. Ad revenue is growing and is expected to double this year again after doubling last year. The company is investing in ad tech and games to boost growth. Game downloads have increased, and the company sees positive effects on acquisition and retention, though currently small. The aim is to keep growing with a focus on diverse content and new revenue streams.
The company’s strong earnings, subscriber growth driven by new initiatives, and optimistic future projections position it for continued success. RiverPark Large Growth Fund stated the following regarding Netflix Inc. (NASDAQ:NFLX) in its Q4 2024 investor letter:
“Netflix, Inc. (NASDAQ:NFLX): NFLX was a top contributor in the fourth quarter powered by a 3Q earnings report that included stronger-than-expected revenue and operating income, solid subscriber additions, and positive forward commentary. Anti-password sharing and ad tier initiatives continue to drive subscriber growth while improving revenue per user trends, from recent price increases, drive margin expansion. The company was optimistic about future revenue growth, margin expansion, free cash flow generation and future return of capital programs.
The recent re-acceleration of subscriber growth, plus price increases on premium memberships and a stabilization of content investments, should position the company for low double digit annual revenue growth over the next few years while driving operating margin to more than 25%. We also believe that the stabilization of content spend should allow the company to continue to scale its free cash flow.”
While we acknowledge the growth potential of Netflix Inc. (NASDAQ:NFLX), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NFLX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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