Tesla (TSLA) Announces Another Stock Split; Shareholders will vote later this year

Tesla (TSLA) announced today that it is planning a new stock split, and it is going to put it up in a shareholder vote later this year.

Back in 2020, Tesla announced a five to one stock split.

At the time, Tesla stock was trading at about $1,300 per share, but the announcement of a stock split sent its stock price to a record high of $2,000 per share.

The split resulted in a reset of the value per share to approximately $460 billion, or a $430 billion market capitalization.

There have been ups and downs since then, but Tesla stock is now up 63% over the past 12 months, and is now trading again at $1,000 a share and more than $1 trillion in market cap.

Today, the automaker announced another stock split — pending shareholder approval.

Tesla wrote in a new SEC filing today:

On March 28, 2022, Tesla, Inc. (“The Company” or “Tesla”) announced its plan to request Stockholder approval at the upcoming 2022 Annual Meeting of Stockholders (“Annual Meeting”) to increase the number of authorized shareholders. Shares of common stock through an amendment to the Company’s Certificate of Incorporation (“Amendment”) to enable the stock split of the Company’s common stock in the form of a stock dividend. Tesla’s board of directors (“Board”) has approved the management proposal, but the stock dividend will be contingent on final board approval.

The filing did not include details about the proposed split, but more should be released along with materials for the shareholder meeting, which usually takes place in June.

Tesla also tweeted about the planned stock split:

Tesla will ask shareholders to vote at this year’s annual meeting to authorize additional shares to enable the stock split.

— tesla (@tesla) 28 March 2022

Today’s announcement sent Tesla’s share price up 5% in pre-market trading, or about $1,060 per share.

Traditionally, companies have announced stock splits to make their price per share more reasonable after their share price has increased significantly. This makes the stock more accessible to small individual investors.

However, the practice has become less useful in recent years as most individual investors have moved to apps such as Robinhood (US) and Wealthsimple (Canada), which allow the purchase of fractional shares on large stocks such as Tesla.

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