With a year-to-date gain of nearly 32%, Meta Platforms (NASDAQ:META) stands out as the top-performing FAANG stock of 2024. It currently ranks among the top five stocks in the S&P 500 Index ($SPX) and has continued its upward momentum from the previous year. While Meta enjoys a surge in performance, the broader trend among FAANG stocks remains relatively consistent, with Apple again emerging as the group’s weakest performer.
Between 2020 and early 2022, several tech giants, including Apple (NASDAQ:AAPL), Nvidia (NASDAQ:NVDA), Amazon (NASDAQ:AMZN), Alphabet (NASDAQ:GOOG), and Tesla (NASDAQ:TSLA), announced stock splits amidst significant rallies in their share prices. Conversely, 2022 witnessed a downturn for tech giants, with no major stock splits occurring. However, as tech stocks, particularly the closely monitored “Magnificent 7,” rebounded in 2023, investors have begun speculating once more on the possibility of mega-cap stock splits.
The question now arises: Will Meta Platforms opt for a stock split in 2024 as it continues to reach new highs? Let’s delve into the discussion.
New Highs Post-Q4 Earnings
Following its Q4 earnings report, Meta Platforms showcased impressive performance, with a 25% revenue increase, marking its highest growth rate since mid-2021. Moreover, the company’s net income more than tripled, driven by a focus on efficiency and aggressive cost-cutting measures. Meta’s Q1 revenue guidance of $34.5 billion to $37 billion exceeded analysts’ expectations of $33.8 billion.
In a historic feat, Meta Platforms set a new Wall Street record as its post-earnings rally propelled a $196 billion rise in its market capitalization, a first for any U.S. company. Meta’s adept navigation of macroeconomic headwinds contrasts with Alphabet’s ongoing efforts to dispel perceptions of lagging in the artificial intelligence (AI) sector.
With a market capitalization of approximately $1.2 trillion, Meta Platforms has reclaimed its $1 trillion market cap and stands as the only FAANG constituent to achieve new all-time highs post-earnings. While Netflix (NFLX) and Amazon also experienced surges after their respective Q4 results, they remain below their 2021 highs.
Meta’s Stock Split History and the Possibility of a 2024 Split
Since its IPO on May 18, 2012, Meta Platforms has never split its shares, unlike its FAANG counterparts, which have undergone multiple splits over the years. The decision to split shares typically arises when a stock’s price becomes perceived as costly or unaffordable for retail investors, aiming to enhance liquidity by making shares more accessible.
Despite no mention of a stock split during Meta’s recent earnings call, investors speculate on the likelihood of an announcement as the stock approaches the $500 mark. Meta ranks as the second most expensive FAANG stock based on absolute stock prices, fueling investor desire for a split.
As Meta continues its upward trajectory, Wall Street analysts have adjusted their target prices accordingly. Justin Patterson of KeyBanc raised his target price to a Street-high of $575, while Gene Munster of Deepwater Asset Management unofficially set a $700 target price, predicting a 50% rise over the next two years.
Conclusion
While Meta’s board may not announce a stock split in 2024, the possibility remains high as the stock’s value surges. A potential split could further boost Meta’s remarkable rally, particularly if its share price surpasses four figures, warranting consideration from the company’s leadership.
Featured Image: Megapixl
Author Faith Yakubu 
