Stock Split Watch: Two Artificial Intelligence (AI) Stocks Look Ready for Splits

In recent years, fromAmazonuntil (a time)Alphabet Many of the top technology stocks, including the U.S., have completed stock splits and their share prices have soared. This involves the company issuing additional shares to existing holders to lower the price per share. This doesn't change the market value of the company or the value of your investment, but it's positive for the company because it makes the stock more accessible to more investors.

For investors, a stock split usually means that the company is doing well, and management hopes that this trend will continue, which could again drive up the stock price over time. So it's worth taking a closer look at split companies, as some may be interesting long-term investments.

The companies best suited for a caribbean spin-off tend to be active in high-growth industries, with stock prices climbing rapidly, even to the $1,000 mark. That's the case with two artificial intelligence (AI) stocks right now. They haven't announced a spin-off yet, but I wouldn't be surprised if they do in the near future, thanks to their incredible performance over the past few years. Let's take a closer look at some of these AI stocks that look ready for a spin-off.

1. INVISTA

along withNvidia (NASDAQ: NVDA)Building on its position as the world's AI chip giant, whose shares have climbed 500% in the past three years, the company sells graphics processing units (GPUs) that power the most critical step in any AI project: the training and inference of AI models. In this way, these models can do the things we want them to do, such as solving complex problems.

The tech giant's GPUs were originally known for their support for GPU gaming and graphics processing, but the introduction of the CUDA programming platform made GPUs readily available for general-purpose computing, which opened the door for their use in artificial intelligence. Now, the bulk of Nvidia's revenue no longer comes from the video game business, but from its data center business. Last year, the company's revenues and profits soared into the triple digits, and given that we're in the early stages of the AI boom, the growth is likely to continue.

Nvidia has split its stock five times in the past, with the most recent split occurring in 2021, when the stock price rose for a period of time, when it was trading at less than $250.

Nvidia's stock price has climbed above $900 this year, very close to the $1,000 level, which could discourage some investors from buying the stock. With the current stock price and the possibility of new growth ahead, now could be a good time for the artificial intelligence star to initiate a stock split. The company plans to release its new Blackwell architecture and chips later this year, and the growth of that platform could give Nvidia stock a huge boost.

2. Microcomputer

Supermicrocomputer Corporation (NASDAQ resonance code: SMCI)The company's stock price has been on a tear, recently outperforming even Nvidia, which has risen by more than 2200% over the past three years, topping $1,000 earlier this year before dropping to its current level of about $940.

Like INVISTA, Supermicro's revenue stream has been transformed by the demand for artificial intelligence. The 30-year-old company, a maker of servers, full rack solutions and other devices, recently announced its first-ever $3 billion quarter as AI customers gravitated toward its products. Supermicro works closely with top chipmakers, including Nvidia, so that it can quickly integrate their products into its platforms, which has led to a surge in demand to record levels. This also means that Supermicro not only benefits from its own new product releases, but also from the ability of all of the major chip companies, from Nvidia toIntelrespond in singingAdvanced Micro Devices) to benefit from the release of a new chip.

Customers also like the fact that Supermicro's products are tailored to their needs, and the company's building block structure means it can fulfill orders quickly.

Supermicro's earnings have been soaring recently and the company has taken steps to maximize its economic benefits to maintain its momentum. The tech giant is doing this by expanding its production, with a new factory in Malaysia focusing on reducing costs and increasing production.

Supermicro has never split its own stock, but given today's stock price - and the potential for a new round of growth in the future - now is the perfect time to kick-start the move.

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Alphabet executive Suzanne Frey is a board member of The Motley Fool. John Mackey, former chief executive officer of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Adria Cimino owns shares of Amazon. The Motley Fool recommends Advanced Micro Devices, Alphabet, Amazon and Nvidia. Nvidia. The Motley Fool recommends Intel and also recommends the following options: long Intel January 2023 $57.50 calls, long Intel January 2025 $45 calls, and short Intel May 2024 $47 calls. The Motley Fool has a disclosure policy.

Stock Split Watch: 2 Artificial Intelligence (AI) Stocks Look Ready for Splits was originally published by The Motley Fool.