Seeds in the Dust: Stocks to Weather the Storm

There’s a restlessness in the air, a shifting of fortunes. Folks have always watched the markets, seen the rise and fall as a kind of weather, predicting lean years and bountiful harvests. Lately, this watching has focused on what they call ‘stock splits’ – a dividing of the pie, making a slice seem bigger, though the whole remains the same. It’s a gesture, really, and gestures often mean something is changing. A company doesn’t cleave its shares without a reason, and usually, that reason is growth, a good harvest earned through honest work. But growth doesn’t guarantee a future, and a split share doesn’t fill an empty belly.

These splits, they’re a signal. Not a promise, mind you, but a signal. History shows a company that divides its holdings often sees a lift in the year that follows, a bit of a tailwind. Bank of America’s Jared Woodard found, on average, such companies return 25% – a decent yield, though the S&P 500 itself manages a more modest 12%. It’s not magic, it’s simply that a smaller price tag makes the fruit seem within reach for more hands, and more hands holding means a stronger push upward.

We’ve been looking at three companies that have recently split their shares, not as a guarantee of riches, but as markers of potential. Companies that have weathered storms and shown a capacity to grow, even when the ground is hard and the sun is scarce. They aren’t promises, but they are worth a closer look, for those who understand that building wealth is a long row to hoe.

A Patient Bloom: Netflix

Netflix, now a familiar name in most homes, has climbed a long way over the past decade, a slow, steady growth like a vine reaching for the light. The stock has seen a gain of 782% over those years, enough to warrant a ten-for-one split last year. But even a strong vine can be bent by the wind. The stock has fallen back, off its peak by 41%, as whispers of trouble with Warner Bros. Discovery and a potential takeover bid from Paramount Skydance circulate. But a wise farmer doesn’t chase every shadow; he looks to the roots.

The numbers tell a story of resilience. Last quarter, Netflix brought in a record $12 billion in revenue, a 17% climb – the fastest in nearly five years. Earnings per share rose 30%, a solid yield. They’ve walked away from costly deals before, and I suspect they’ll do so again. They know the value of a strong foundation, not fleeting extravagance.

Most on Wall Street see the strength, with 70% rating it a buy or strong buy. The average price target is $111, implying a potential upside of 43%. BMO Capital’s Brian Pitz is even more optimistic, projecting a gain of 73%. He sees the growth in ad revenue, expected to double to $3 billion this year, as a sign of a healthy harvest. The stock trades at 31 times earnings, the lowest valuation in three years, making it a reasonable investment for those with a patient hand.

Ripples on the Water: Booking Holdings

Booking Holdings, a name less visible but no less powerful, has been a quiet engine of wealth for a quarter-century, rewarding patient investors with returns exceeding 31,000%. They recently announced a massive 25-for-1 stock split, a gesture of confidence after years of speculation. But even a strong current can be disrupted by a sudden storm.

The stock tumbled this week, as fears of a slowdown in travel spread. But the numbers tell a different story. Revenue grew 16% year over year to $6.3 billion, driving earnings per share up 38% to $44.22. Gross bookings rose 16%, while room nights increased 9%. Cash flow soared, with operating cash flow reaching $1.5 billion and free cash flow hitting $1.4 billion. This is a company that knows how to gather and hold its resources, a valuable trait in uncertain times.

Wall Street largely agrees, with 77% rating the stock a buy or strong buy. The average price target is $5,915, implying a potential upside of 45%. HSBC‘s Meredith Prichard Jensen is particularly bullish, with a price target of $7,746 – the highest on Wall Street – implying a potential upside of 90%. She calls Booking an “undervalued global leader,” a fitting description for a company that has weathered so many storms.

The Automaton’s Promise: ServiceNow

ServiceNow, a more recent arrival, has gained 852% over the past decade, despite a recent plunge of 55% from its peak. The stock traded above $800 per share, prompting a 5-for-1 split. But even the most efficient machines can be shaken by the changing landscape.

The stock has been caught up in the downturn in software-as-a-service (SaaS) stocks, with fears that its software tools, which automate repetitive tasks and streamline workflows, will be disrupted by artificial intelligence (AI). But the numbers remain robust. Revenue grew 21% year over year to $3.53 billion, driving adjusted basic EPS up 24% to $0.92. Remaining performance obligation (RPO) climbed 27% to $24.3 billion, building a solid foundation for future growth. This is a company that understands the value of a well-oiled machine, even in the face of disruption.

Wall Street remains optimistic, with 91% rating the stock a buy or strong buy. The average price target is $189, implying a potential upside of 81%. Citizen’s Patrick Walravens is even more bullish, with a price target of $260 – the highest on Wall Street – implying an upside potential of 149%. He cites the company’s revenue growth, margin expansion, and “attractive financial profile” for his bullish view.

ServiceNow has shed its frothy valuation and now trades at 30 times earnings. Given its compelling growth prospects, it is worth a look for those who understand that building wealth is not about chasing the latest miracle, but about investing in solid foundations, companies that know how to adapt and endure.

2026-02-22 11:03

A Patient Bloom: Netflix

Ripples on the Water: Booking Holdings

The Automaton’s Promise: ServiceNow

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