Tesla to Request Shareholder Approval for Another Stock Split

MAR 31 2022·Updated SEP 29 2022

Story

Image credit: Reuters [via Business Insider]

The Facts

Electric vehicle (EV) manufacturer Tesla announced Mon. that it will ask its shareholders to approve a proposed share split at an upcoming annual shareholders meeting.
USA Today
The company didn't offer details on when the proposed split would occur or how many new shares would be awarded for each existing share.
CBS News
This will be Tesla's second stock split in less than 2 yrs following its 5-for-1 split in Sept. 2020.
USA Today
Tesla sold an additional $10B of its stock in the months surrounding the Sept. 2020 split, a move that diluted the value of each existing share.
CBS News
Since the announcement, Tesla's shares have jumped more than 5% and are up more than 60% over the past year.
USA Today
Tesla has seen a meteoric rise in recent years, and it opened its first European manufacturing facility in Germany just last week.
CBS News

Sources Split

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The Spin

Narrative A

Stock splits allow Main Street investors to participate in the incredible growth of innovative tech giants. When a company like Tesla splits its stock, it benefits itself and the consumer. Investors now have the ability to purchase a stock of a company they previously couldn't afford, fueling rallies in the company's shares and allowing it to invest in the future.

CNET

Narrative B

Tesla splitting its stock shows that the company is growing in the right direction. However, those who trade stock and options will take advantage of the split environment for trading. This can hurt Tesla and investors in the future as it can potentially create a lot of volatility in the markets before and after the split.