It’s been a while since we had a headline-worthy stock split. With the stock market starting the year in a hole caused by Trump tariffs, with last year’s biggest gainers taking harder punches to the gut, it should be no surprise as to why the pace of large and mega-cap share splits has ground to a halt.
At this pace, the market may just need time to drive stock prices down markedly without requiring a company’s managers to lift a finger. And while Trump tariffs could spark a recession and worsening of the broad market sell-off, investors shouldn’t be too surprised if splits start making headlines again in the second half if the market manages to find its footing, as new trade deal news causes pessimism to be replaced by a sense of optimism and hope.
Indeed, we’re all tired of the endless Trump tariff talk. And while earnings and tariff commentary from corporate managers are going to dictate the trajectory of stocks from here, I’d not be too surprised if firms “sandbag” on guidance to account for vast unknowns that lie ahead. As share prices nosedive and valuations compress, there is one stellar tech titan that’s managed to defy the odds, rising, even in the face of fear. And it’s this massive gainer that makes for a top split candidate for the second half of 2025, in my opinion.
Key Points
Netflix stock is overdue for a split after a huge rally that sent it north of $1,000 per share.
Don’t be too surprised if Netflix winds up the only mega-cap tech titan to split in 2025.
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Netflix stock has surged ahead as a “tariff safe haven” stock
Netflix (NASDAQ:NFLX) has become a lone magnificent tech stock that’s not even a part of the Magnificent Seven. With such resilient gains in the face of broad market turmoil, NFLX stock should be a Magnificent name. For now, it’s the Magnificent One. And it’s looking like a split-worthier candidate by the day. After clocking in another impressive quarter, Netflix stock is close to a new all-time high, just north of $1,150 per share.
Given its tariff resilience (at least thus far), relative economic stability, and retention of the video streaming crown, perhaps Netflix is a stock-split stock to hang onto for the long haul. Though a proposed 100% tariff on foreign films could throw a wrench into Netflix stock’s impressive run, Raymond James analyst Andrew Marok thinks that it’s too early to gauge the impact, given the “vast number of variable items.”
Indeed, tariffs on video content may never see the light of day. Either way, around half of Netflix’s original content is made outside of America, according to Citi’s Jason Bazinet, who has a neutral rating on the stock and a price target that entails slight single-digit percentage downside. Whether Netflix’s days of having a free pass on the tariff correction are numbered remains the big question. Like it or not, it’s no longer a name that’s immune to the tariff impact.
Correction or not, Netflix stock needs a split
Even if a correction is overdue at some point, I’m sure retail investors are eagerly awaiting a split so that picking up one share isn’t such a daunting task. At more than a grand per share, Netflix stock is long overdue for a big split, perhaps a 10-for-1 split, even as tariff headwinds present themselves. At the end of the day, Netflix’s managers have been through worse. And while it’s easy to forget that the streamer lost close to 75% of its value during late-2021 and early-2022, I do think that the company has done more than enough to demonstrate its reputation as a steady place to shelter from economic headwinds.
Even if tariffs take a bite out of earnings, Netflix is becoming more of a staple than a nice-to-have for many households. If there are subscriptions to cut, Netflix is last on the list for many. For some, it’s not even on that list, given its high hours of entertainment per dollar spent. Recession or not, I think Netflix is a prime stock split candidate, if not the only one from the mega-cap tech cohort.
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