Stock-Split Stocks: One to Buy, One to Avoid in August

Investors have long been captivated by transformative technologies, with artificial intelligence (AI) dominating Wall Street's attention for nearly three years. Yet another trend has emerged alongside AI: the resurgence of stock splits among top-tier companies.

Stock splits, whether forward or reverse, superficially adjust share prices and counts without altering market capitalization. Forward splits, which reduce nominal share prices, have historically attracted retail investors seeking affordability. Reverse splits, often employed by struggling firms to avoid delisting, typically signal underlying weaknesses.

The market's bifurcated reaction to these corporate actions underscores a deeper truth: not all splits are created equal. While forward splits may generate short-term enthusiasm, reverse splits frequently foreshadow continued challenges.