Tesla shares look to be significantly cheaper in 3-to-1 stock split

The stock will begin trading on a split-adjusted basis on August 25.

Tesla (TSLA) Shareholders approved the split Thursday at the company’s annual shareholder meeting. After the split, the person who owned one of his shares in the company now owns three of his shares, and the price per share is one-third of what he was at the time. At Friday’s closing price of about $865, his post-dividend price per share would be about $288.

Stock splits are usually done to increase the liquidity of a stock and make it easier for investors to buy or sell the stock. Essentially, the move triples the number of Tesla shares on the market, but leaves the company’s overall valuation, and the value each investor holds, unchanged. It can also increase demand for stocks as it puts them within reach of large retail investors.

Tesla has made such moves before. As recently as 2020.

Wealthy institutional investors don’t really care about the company’s overall stock price, but retail investors may be put off by overpriced stocks. Stock splits have become more important in recent years due to the growth of free trading apps such as Robinhood and E-Trade.

When Tesla Announced intention to conduct a stock split In a regulatory filing earlier this year, the company said, “We believe the stock split will help reset the market price of our common stock and provide our employees with more flexibility in managing their shares. shareholder value.”

Source: www.cnn.com

Leave a Reply

Your email address will not be published. Required fields are marked *

Bảie leveluplimo