Sandisk splits its stock 8 for 1. The story is about what usually happens to stocks after a split announcement.

Sandisk (SNDK -13.47%) gave investors two pieces of news on Thursday, October 29. The flash memory company’s fiscal first quarter revenue increased 23% from the previous quarter to $11.0 billion. And the board approved an eight-for-one stock split, with split-adjusted negotiations scheduled to begin Friday, November 20.

Does a split announcement tell investors what direction a stock will take next? I checked what happened during the year after eight big-name split announcements, measured from each stock’s close on the day of the announcement.

Five of the eight were up a year later, and the median stock was up about 26%. Five also beat the S&P500. But the results went from a 43% decline to a 79% gain.

Image source: Getty Images.

Eight divisions, five wins

Apple announced their split on July 30, 2020. Nvidia announced one on May 21, 2021 and another on May 22, 2024. Alphabet followed on February 1, 2022, and Amazon on March 9, 2022.

Walmart announced its split on January 30, 2024, Broadcom June 12, 2024, and Netflix on October 30, 2025.

Walmart did its best, with its inventory rising about 79% the following year. Broadcom climbed about 71% and Apple 52%. Nvidia rose 40% after its 2024 announcement and 11% after its 2021 announcement, but that more modest gain still beat an S&P 500 that fell over the same 12 months. Alphabet lost about 27% and Amazon lost about 34%. Netflix is ​​down about 43% as I write, a day shy of its full year.

These are price figures only, adjusted for splits, without taking into account dividends.

In other words, a split announcement comes with higher odds than even a higher stock a year later. But he didn’t say much about the size of the gain.

What separated the winners?

Yet where each stock stood when its board was acting appears to have mattered. Six of the eight stocks closed within about 8% of their 52-week closing high on the day of the announcement, and five of them were up a year later.

The exception, Alphabet, ran into the 2022 bear market, when the S&P 500 slipped about 9% during the same period.

The two that reported well below their peaks did the worst. Amazon closed down about 25% below its 52-week high on the day of the announcement, then fell another 34% the following year. Netflix reported a drop of about 19% below its peak and has since fallen about 43%.

Two examples is a thin matter, so I wouldn’t take it as a rule. But that suggests the split itself mattered less than where each stock started and where the market went next.

Sandisk setup is different

Sandisk splits much lower than any stock in the group. At around $1,330, its Oct. 29 close was 43% below the record high of $2,335 set on June 25, although the stock is still up about 551% since its close a year ago.

And its growth is slowing down. Sandisk’s 23% sequential increase for the first quarter of fiscal 2027 (the three months ended October 2, 2026) followed sequential jumps of 51% and 97% in the previous two quarters. Management’s guidance for second-quarter revenue of $12.2 billion to $12.6 billion implies sequential growth of about 12% at the midpoint.

Perhaps margins shouldn’t be much higher either. Gross margin reached 85% in the fiscal first quarter, up from around 30% a year earlier. And management’s second-quarter fiscal guidance projects roughly the same level.

Of course, investors already seem skeptical. The stock sells for about 11 times earnings, based on its non-GAAP (adjusted) earnings per share over the last four quarters. If Sandisk hit the midpoint of its second-quarter adjusted earnings guidance every quarter for a year, the stock price would only be about 6 times those earnings. Investors generally pay as low a price-to-earnings ratio for a growing company as they do when they expect its earnings to decline.

Yes, the company is much stronger than it was a year ago. Data center revenue increased 61% sequentially to $4.8 billion in the fiscal first quarter, up from $269 million a year earlier. But when it comes to its stock’s position, Sandisk arguably looks more like Amazon in 2022 and Netflix in 2025, which also reported well below their highs, than stocks that split near their record highs and continued to climb.

Flash prices could stay high for longer than investors seem to think, and that could matter a lot more than the split. I just wouldn’t count on the history of the split to help much here.