Tesla to Request Shareholder Approval for Another Stock Split

    Image copyright: 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.

    • 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.

    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.

    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.

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