After Amazon's split, here's who could be next, according to Bank of America

Published Thu, Mar 10 202210:11 AM EST

Amazon shares popped after the tech giant announced a 20-for-1 stock split , its first since the dot-com boom, and Bank of America believes the move could inspire other companies with hefty share prices to follow suit. Amazon is the latest highly valued tech company to pull down the price of each share through a split. Google parent Alphabet announced a 20-for-1 split in February. In mid-2020, Apple disclosed plans for a 4-for-1 split , and Tesla also conducted a 5-for-1 split . Stock splits are often intended to increase liquidity and lure more interest from regular investors. A stock split theoretically could boost retail share ownership as the cheaper stock price is more accessible to a wider range of investors. However, it doesn't change a company's underlying fundamentals or the intrinsic value of its shares. Still, stock splits have historically led to an outperformance, according to Bank of America. Since 1980, S & P 500 companies that have announced stock splits have significantly outperformed the index three, six, and 12 months after the initial announcement, according to Bank of America. Stocks that have split on average climbed 25% over the next 12 months, versus 9% gains for the S & P 500 , according to the Wall Street firm. Here are the S & P 500 companies with the highest share prices, which have the most likelihood to pull off a stock split in the foreseeable future. Home construction company NVR currently has the highest share price among S & P 500 companies with a price tag above $4,800. Travel company Booking Holdings is trading above $2,000 a share as of Thursday. The company recently suffered a sell-off after warning that there will be periods this year when the pandemic hurts travel demand. Chipotle is another stock that could do a stock split in the near future as its shares are trading above $1,400 apiece. Last month, Chipotle topped Wall Street's estimates for its fourth-quarter earnings and met its expectations for revenue. The burrito chain is facing higher costs for labor and ingredients, but price hikes have helped offset the impact. Meanwhile, Tesla could possibly split its stock again with shares trading above $850. The EV stock is down about 6% this year after a near 50% rally in 2021.

The Amazon logo is seen at the company's logistics centre in Boves, France, February 11, 2022.

Pascal Rossignol | Reuters