Tesla Plans Another Stock Split
Mar 30,2022 | Chloe Lacour
Tesla will ask shareholders for permission to split its shares on March 28, local time in the United States, in order to pay dividends to shareholders. As a result of this news, Tesla's stock rose 8.03 percent on the day, closing at $1,091.84 per share.
The above plan has been approved by the board of directors of the company. However, Tesla did not specify how much of the stock will be split. The proposal to split the stock was first announced on Twitter, and it will be voted on by shareholders at the annual meeting. If approved, the stock split would be the latest after Tesla split its stock 5-1 in August 2020.
According to the report, splitting the stock will have no effect on the company's market value or its fundamentals. However, a split could lower the price of a share and attract more investors to the stock. In retrospect, stock splits have been beneficial to companies, according to a recent research note from Bank of America Global Research. The average stock return one year after a public company split its stock was 25%.
"This stock split may further fuel the stock bubble that Tesla has been brewing over the last two years," said David Trainer, CEO of investment research firm New constructors. Reig, an analyst at Roth Capital, is a financial institution. "We believe the Tesla Berlin car market will grow significantly, and minis and Indian cars are on the way, and we agree to a stock split at this time," Irving said, implying that companies typically wait until good news arrives before splitting their stock. Divide the stock.
Tesla isn't the only major technology firm to have announced a stock split in recent years. Amazon announced on March 9 that it would split its stock in half at a ratio of 1:20. Amazon's stock has risen by about 20% since March 9. In addition, Alphabet, Google's parent company, announced a 1-for-20 stock split in February. In mid-2020, Apple announced a 1-for-4 stock split.
Tesla, which produces nearly 1 million electric vehicles per year, is expanding production in Austin, Texas, and Berlin, Germany, in response to the new crown pneumonia epidemic and increased competition.
Analysts at investment research firms predict that Tesla's revenue in the first quarter of this year will be $16.44 billion, a 58.2 percent increase from $10.389 billion in the same period last year and a 7.2 percent decrease from $17.719 billion in the fourth quarter of last year.