Although the two-year anniversary of Wall Street’s bull market is largely due to excitement surrounding artificial intelligence (AI), it’d be a mistake to overlook the key role stock-split euphoria has played in lifting select market leaders in 2024.

A stock split is a tool available to publicly traded companies that allows them to cosmetically adjust their share price and outstanding share count by the same factor. These changes are surface-scratching in the sense that they don’t alter a company’s market cap or its operating performance.

While splits come in two varieties — forward and reverse — investors overwhelmingly favor one over the other. Since reverse splits (the type designed to increase a company’s share price) are usually conducted from a position of operating weakness, it’s the type of split most investors avoid. Meanwhile, forward splits, which lower a company’s share price to make it more nominally affordable for everyday investors, are typically undertaken by businesses with well-defined competitive advantages. This is the type of split investors flock to.

Over the last nine months, more than a dozen brand-name businesses have completed a stock split. However, the outlook for these stock-split stocks differs quite a bit, based on the price targets issued by select Wall Street analysts.

In particular, three industry-leading stock-split stocks offer implied upside of up to 111%.

Nvidia: Implied upside of 45%

Perhaps it comes as no surprise that one of the stock-split stocks with the most robust upside potential, based on the forecast of at least one Wall Street analyst, is the company leading the AI revolution, Nvidia (NASDAQ: NVDA). Nvidia joined this elite club of stock-split stocks in June with a historic 10-for-1 forward split.

Analyst Hans Mosesmann of Rosenblatt Securities foresees this transformational company reaching $200 per share, which would represent a 45% return from its closing price on Oct. 14 and make Nvidia a roughly $5 trillion business.

Nvidia’s near-parabolic move higher is the result of its hardware becoming the “brains” of AI-accelerated data centers. Demand for the company’s H100 graphics processing unit (GPU) and successor Blackwell GPU architecture have been robust, which has left little room for external competitors.

When an in-demand good or service is in short supply, the laws of economics state that the price of that good service will climb until demand levels off. Nvidia’s H100 has been commanding anywhere from a 100% to 300% price premium over other AI-GPUs, which has helped push the company’s adjusted gross margin notably higher.

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Additionally, Nvidia’s CUDA software platform is doing its part to keep the company’s customers loyal to its ecosystem. CUDA is the toolkit developers rely on to build large language models and squeeze as much computing power as possible out of their Nvidia GPUs.

But while Mosesmann’s target of 45% additional upside appears reachable, there are also reasons to believe Nvidia’s stock has peaked. For instance, no game-changing innovation, spanning three decades, has avoided a bubble-bursting event early in its expansion.

Furthermore, internal competition is picking up in a big way. With Nvidia’s four-largest customers developing AI-GPUs of their own, Nvidia may find that future order opportunities for its hardware are limited.

Sirius XM Holdings: Implied upside of 60%

A second stock-split stock that can skyrocket, according to the view of one Wall Street analyst, is satellite-radio operator Sirius XM Holdings (NASDAQ: SIRI). Sirius XM is the only high-profile stock-split stock of 2024 that completed a reverse split (1-for-10).

Benchmark analyst Matthew Harrigan believes shares of Sirius XM are headed to $43. If accurate, this would imply upside of 60%, based on where the company’s stock closed out the Oct. 14 trading session.

Though the company’s subscriber figures have declined in back-to-back quarters, which is mostly a function of tepid auto sales, it nevertheless brings well-defined competitive advantages to the table.

The most obvious competitive edge for Sirius XM is that it’s a legal monopoly. While being the only licensed satellite-radio operator doesn’t mean the company is free of competition for listeners, it does afford Sirius XM substantial subscription pricing power.

Sirius XM’s omnichannel presence is another source of strength. Most traditional radio operators generate almost all of their revenue from advertising. Though this strategy works great during long-winded economic expansions, it can lead to problems during inevitable recessions.

Through the first-half of 2024, Sirius XM generated less than 20% of its net sales from ads and close to 77% from subscriptions. A subscription-driven model leads to highly predictable cash flow and makes it less likely that Sirius XM will see wild fluctuations in revenue and profits during shifts in the economic cycle.

The final factor on Sirius XM’s side is its historically cheap valuation. Even following a nice bounce from a recent decade-low closing price, shares of the company are valued at roughly 8 times forward-year earnings. This represents a bargain for long-term-minded investors.

Super Micro Computer: Implied upside of 111%

But the stock-split stock that offers the most robust upside, according to the prognostication of one Wall Street analyst, is customizable rack server and storage solutions specialist Super Micro Computer (NASDAQ: SMCI). Super Micro completed its first-ever forward split, 10-for-1, following the close of trading on Sept. 30.

Wall Street’s biggest Super Micro Computer bull is analyst Ananda Baruah of Loop Capital. Baruah’s $100 price target, which has been split-adjusted down from $1,000, implies scorching-hot upside potential of up to 111%.

Although Nvidia’s AI-GPUs are the hottest thing since sliced bread, there’s an opportunity for businesses throughout the data-center economy to thrive. Super Micro happens to be one of the go-to providers of customizable rack servers used in high-compute data centers. Its servers also incorporate the H100 GPU, which is presumably lifting demand for the company’s infrastructure solutions.

The revenue acceleration for Super Micro has been eyepopping. Net sales surged 110% in fiscal 2024 (ended June 30) to $14.94 billion, with the company guiding net revenue to a range of $26 billion to $30 billion in fiscal 2025. The upper bound would represent back-to-back years of triple-digit growth.

Nevertheless, it’s not all peaches and cream for this infrastructure colossus. Noted short-seller Hindenburg Research has alleged “accounting manipulation” at Super Micro, which the company has denied. Despite this denial, the U.S. Justice Department has reportedly opened an early stage probe into the company, and Super Micro has delayed the filing of its annual report. It’s not the best look for an S&P 500 company.

It’s also worth pointing out that Super Micro Computer is somewhat at the mercy of its suppliers. Just as incorporating Nvidia’s H100 GPUs has made its customizable rack servers a top choice for businesses building out their AI-accelerated data centers, the backlog of this in-demand GPU could put a low ceiling on Super Micro’s upside.

Until the company’s accounting questions are resolved and its annual report is filed with the Securities and Exchange Commission, triple-digit upside for its stock doesn’t seem attainable.

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Sean Williams has positions in Sirius XM. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

3 Stock-Split Stocks That Offer Up to 111% Upside, According to Select Wall Street Analysts was originally published by The Motley Fool