TSLA stock splits again
TSLA stock splits again as recently announced by Tesla. Tesla (TSLA) stated that it is considering a fresh stock split; which will be put to the vote by shareholders later this year.
Tesla announced a five-for-one equity split in 2020. Tesla’s stock was selling at roughly $1,300 per share, but the stock split declaration sent it soaring to a new high of $2,000 per share.
Since then, there’s been ups and downs; but Tesla’s stock is currently up 63 percent in the previous year, trading at over $1,000 per share and with a market worth of over $1 trillion.
The carmaker announced another stock split today, subject to shareholder approval. The Tesla annual shareholders’ meeting has been postponed for the past two years, owing to the COVID problem.
However, these gatherings have primarily taken place in June in the past. Companies have often announced stock splits to lower their price per share when their stock price has grown significantly.
It makes the stock more approachable to individual investors with smaller portfolios. However, the technique has been less beneficial in recent years. Since most individual investors have turned to applications that allow them to buy fractional shares in large companies like Tesla.
Why is TSLA going for a stock split?
It is because the business filed a Form 8-K with the Securities and Exchange Commission today; stating that it intends to hold another stock split vote. However, it’s possible that it’s to increase the stock.
TSLA has quadrupled in value since its previous stock split in August 2020. However, it is down over 4% for the year from the beginning of 2022.
Stock splits do not automatically raise the value of shares; but they can help improve the interest of stock among retail investors owing to the lower price, which may cause shares to rise in value. The actual reason for the stock split is still a mystery.
If you own TSLA shares; you’ll almost certainly be able to vote for the stock split in favor of the stockholders in 2022. The yearly meeting measure during the company’s annual meeting for 2021 was in October.
By: Bahaar Abdullah