Tesla shares to get more affordable. Key things to know about stock splits

After the close of trading on August 24, investors will receive two additional Tesla shares for each one they own until August 17. In theory, Tesla’s stock price should drop by about two-thirds to about $290 before trading begins on Wednesday. Tesla’s market cap was above $908 billion as of Monday’s close.

shares of Tesla Its stock has climbed nearly 25% since the electric-vehicle company announced plans to split its stock on June 10. Shareholders cleared a path for a stock split at its August 4 annual shareholders meeting, and the automaker disclosed the terms of the split on August 5. Although a split does not affect the fundamentals of the company, it can ease the share price. For investors to own the stock.

a stock split Increases the number of outstanding shares by issuing more shares to existing shareholders. A stock split reduces the market value of individual shares, however, the market capitalization of the company does not change.

Stock splits don’t make a company more valuable or more profitable, but the hope is that the stock looks affordable to more investors. Tesla joins US stock market heavyweights Amazon and Google parent Alphabet, which also split their high-priced shares in 2022.

Tesla previously implemented a 5-for-1 stock split nearly two years ago on August 31, 2020, when the company’s shares began trading on a split-adjusted basis.

Tesla Chief Elon Musk The company has previously said that the company aims to achieve a production rate of two million vehicles per year by the end of 2022 and will continue to build factories.

Tesla has factories in California and Shanghai and two more in Austin, Texas and Berlin. Musk said Tesla may be able to announce an additional factory this year and expects to eventually have 10-12 so-called gigafactories.

first article