Sandisk Is Splitting Its Stock 8-for-1. History Says What Usually Happens to Stocks After a Split Announcement.
Sandisk (NASDAQ:SNDK) gave investors two pieces of news on Thursday, Oct. 29. The flash memory company’s fiscal first-quarter revenue grew 23% over the previous quarter to $11.0 billion. And the board approved an eight-for-one stock split, with split-adjusted trading expected to start Friday, Nov. 20.
Does a split announcement tell investors anything about where a stock heads next? I checked what happened over the year after eight big-name split announcements, measured from every stock’s close on announcement day.
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Five of the eight were up one year later, and the median stock rose around 26%. Five also beat the S&P 500. But the results ran from a 43% drop to a 79% gain.
Image source: Getty Images.
Eight splits, five gains
Apple announced its split on July 30, 2020. Nvidia announced one on May 21, 2021, and another on May 22, 2024. Alphabet followed on Feb. 1, 2022, and Amazon on March 9, 2022.
Walmart announced its split on Jan. 30, 2024, Broadcom on June 12, 2024, and Netflix on Oct. 30, 2025.
Walmart did best, with its stock up around 79% in the next year. Broadcom climbed about 71%, and Apple gained 52%. Nvidia rose 40% after its 2024 announcement and a smaller 11% after its 2021 one, but that smaller gain still beat an S&P 500 that dropped in the same 12 months. Alphabet lost around 27% and Amazon about 34%. Netflix is down about 43% as I write, a day shy of its full year.
These are price-only numbers, adjusted for the splits, with dividends left out.
Put another way, a split announcement has come with better-than-even odds of a higher stock a year later. But it hasn’t said much about how big the gain would be.
What separated the winners?
Still, where every stock stood when its board acted looks to have mattered. Six of the eight closed within about 8% of their 52-week closing high on announcement day, and five of those six were up a year later.
The exception, Alphabet, ran into the 2022 bear market, when the S&P 500 slid about 9% in the same span.
The two that announced from well below their highs did worst. Amazon closed around 25% under its 52-week closing high on announcement day, then dropped another 34% in the next year. Netflix announced from about 19% below its high and has since fallen about 43%.
Two examples is a thin record, so I wouldn’t take it as a rule. But it does suggest the split itself mattered less than where every stock began and where the market headed next.
Sandisk’s setup looks different
Sandisk is splitting from much further down than any stock in the group. At around $1,330, its Oct. 29 close was 43% below the $2,335 record close it set on June 25, even though the stock’s still up about 551% since its close a year ago.
And its growth is slowing. The 23% sequential rise Sandisk posted for fiscal Q1 of 2027 (the three months ended Oct. 2, 2026) followed sequential leaps of 51% and 97% in the two quarters before it. Management’s guidance for fiscal Q2 revenue of $12.2 billion to $12.6 billion implies about 12% sequential growth at the midpoint.
Margins might not have much higher to go, either. Gross margin reached 85% in fiscal Q1, up from about 30% a year before. And management’s fiscal Q2 guidance calls for about the same level.
Of course, investors already look skeptical. The stock sells for about 11 times earnings, based on its non-GAAP (adjusted) earnings per share in the last four quarters. If Sandisk earned the midpoint of its fiscal Q2 adjusted earnings guidance every quarter for a year, the stock’s price would be only about 6 times those earnings. Investors usually pay a price-to-earnings ratio that low for a growing company only when they expect its earnings to drop.
Yes, the business is much stronger than it was a year ago. Data center revenue rose 61% sequentially to $4.8 billion in fiscal Q1, up from $269 million a year before. But on where its stock sits, Sandisk arguably looks more like Amazon in 2022 and Netflix in 2025, which also announced from well below their highs, than the stocks that split near their records and kept climbing.
Flash prices might stay high longer than investors seem to think, and that may matter far more than the split. I just wouldn’t count on the split’s track record to help much here.
Should you buy stock in Sandisk right now?
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Daniel Sparks and his clients have positions in Apple. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Broadcom, Netflix, Nvidia, and Walmart. The Motley Fool has a disclosure policy.
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