Regardless of how long you've been putting your money to work on Wall Street, it's been a rough year. All three of the major U.S. stock indexes have entered a bear market, with the widely followed S&P 500 producing its worst first-half return in 52 years. The icing on the cake is the bond market is having its worst year in history.

But even with this chaos, investors have found a source of optimism with stock-split stocks.

An up-close view of the word shares on a paper stock certificate of a publicly traded company.

Image source: Getty Images.

A "stock split" is an event that allows a publicly traded company to alter its share price and outstanding share count without impacting its market cap or operations. Forward stock splits, which reduce the share price of a stock to make it more nominally affordable for everyday investors, have been especially popular of late.

More than 200 stock splits have been undertaken this year. But among these numerous splits are a handful of special cases. There are two dirt cheap stock-split stocks that investors are going to regret not buying at their new nominally lower share price, as well as one popular stock-split stock that remains exceptionally pricey and is worth avoiding.

Bargain-priced stock-split stock No. 1 you'll regret not buying: Alphabet

The first dirt cheap stock that investors should be clamoring to buy is Alphabet (GOOGL -1.05%) (GOOG -1.00%), the parent company of internet search engine Google, streaming platform YouTube, and autonomous vehicle company Waymo, among other subsidiaries.

Alphabet was the company that effectively kicked off the stock-split bonanza of 2022. In February, its management team announced plans to conduct a 20-for-1 forward stock split, which was eventually approved by shareholders and completed in July. The company whose shares once commanded a $3,000 price tag can be bought for less than $100, as of Oct. 20, 2022.

Though there are clear concerns about advertising spending in a rising-rate environment, Alphabet's competitive advantages and innovations make it a superstar that should be in most investor's portfolios. For example, Google has controlled between 91% and 93% of worldwide internet search share for more than two years.  With such an insurmountable lead over every one of its competitors, it should come as no surprise that businesses will pay a premium to place their message on Google's search pages.

However, Alphabet is becoming far more than just an internet search kingpin. YouTube is the second most-visited social site on the planet, leading to an annual ad run-rate of almost $30 billion.  There's also Google Cloud, which has gobbled up an estimated 8% of global cloud-service spending, according to a report by Canalys.  These fast-paced segments could easily become Alphabet's core drivers of operating cash flow growth within a few years.

Investors can buy shares of Alphabet right now for a mere 17 times Wall Street's forecast earnings for 2023, as well as just 10 times projected cash flow for 2024. Both figures are historically low for a company that can sustain a double-digit growth rate for a long time to come.

Bargain-priced stock-split stock No. 2 you'll regret not buying: Amazon

A second dirt cheap stock-split stock that investors are going to regret not buying -- especially with the bear market pummeling retail stocks -- is Amazon (AMZN -1.54%). Amazon completed a 20-for-1 forward stock split in June.

Some investors are, rightly, going to be scratching their heads and wondering how the words "Amazon" and "dirt cheap" can be used in the same sentence. After all, retailers are being battered by historically high inflation and supply chain woes, and Amazon is anything but "cheap" using traditional fundamental metrics like the price-to-earnings (P/E) ratio. But rest assured, if you do some digging into Amazon's ancillary operations and its cash flow-generating potential, you'll realize this company is historically inexpensive.

Most people associate Amazon with its dominant online marketplace. According to eMarketer, Amazon is estimated to bring in 39.5% of all U.S. online retail sales this year.  But what needs to be understood is that Amazon's top revenue segment produces some very thin operating margins. It's far more important that the company's ancillary operations are thriving -- and they are!

Amazon's marketplace has helped the company sign up more than 200 million members to Prime worldwide, as well as boost its ad revenue. Subscription services and advertising services are each generating in the neighborhood of $35 billion in annual run-rate sales. 

Even more important is Amazon Web Services (AWS), the world's top cloud infrastructure service provider with just shy for four times the market share (31%) of Google Cloud, as of the end of June. AWS is the key cog that can dramatically increase Amazon's operating cash flow, even if its retail marketplace remains stagnant.

Because Amazon chooses to aggressively reinvest in its business, cash flow is a far better measure of "value" for this company than the P/E ratio. After ending each year between 2010 and 2019 at a cash flow multiple ranging from 23 to 37, Amazon is currently priced at less than 9 times Wall Street's forecast cash flow for 2025. It's a heck of a bargain for growth-and-value-oriented investors.

A Tesla Model 3 driving down a wet road during snowy conditions.

The Model 3 has become Tesla's flagship EV. Image source: Tesla.

The expensive stock-split stock you'll be glad you avoided: Tesla

But not every stock-split stock is unlocking perceived value for investors. Even though electric-vehicle (EV) manufacturer Tesla (TSLA -2.03%) is widely held and riding a first-mover advantage in North America, it's an expensive stock that investors will probably be glad they avoided. Tesla enacted a 3-for-1 split in late August.

Tesla is the first automaker in more than five decades to have successfully built itself to the point of mass production. After delivering nearly 344,000 vehicles during the September-ended quarter, Tesla looks to be on track to surpass 1 million deliveries for the first time this year. 

The company has also firmly pushed into the profit column. But that's where, in my view, the good news ends.

There is a long list of concerns investors should have with Tesla, from the company's competitive advantages, to its CEO and valuation. When it comes to the former, it'll likely be impossible for Tesla to sustain its early market share gains considering legacy automakers are investing billions into EV and autonomous vehicle research. To add, even relatively new auto companies are producing EVs that can outpace Tesla's flagship vehicle (Model 3) in select attributes, such as range.

Tesla CEO Elon Musk is a massive liability as well. Putting aside the Twitter acquisition circus and Musk's affinity for drawing the ire of regulators, it's his laundry list of empty promises that's most disturbing. Tesla's valuation is built on the expectation of robotaxis, level 5 full self-driving, the Cybertruck, and so many more promised innovations that have failed to materialize.

Whereas most auto stocks are valued at a single-digit forward P/E ratio to reflect the cyclical nature of the industry, Tesla is commanding a nosebleed forward earnings multiple of close to 35. Yes, Tesla is more than just an auto stock, but its ancillary operations (e.g., energy) are money-losers. It simply doesn't deserve its premium and is best off avoided.