Tesla Announces Second Stock Split in Two Years
Investors Question Rationale as Company's Market Share Declines
Summary
Tesla (TSLA) announced on August 17, 2022, a plan to split its stock for the second time in two years. Shareholders of record on August 17 will receive two additional shares of common stock for each share they currently own. This brings Tesla's total number of stock splits to two, with the most recent occurring on August 25th.
Some investors are questioning the rationale behind the stock split, as Tesla's share of the US battery-electric vehicle (BEV) market has been declining in recent months. In the second quarter of 2024, Tesla's BEV market share dropped to 53%, down from 62% in the same period last year.
Tesla's management team has not yet provided a clear explanation for the stock split, but some analysts believe it may be an attempt to make the stock more affordable to individual investors. The company's shares have been trading at over $1,000 per share for much of the past year.
The stock split is expected to take effect on September 22, 2022. Tesla's earnings call for the second quarter of 2024 is scheduled for July 23, 2024, at 5:30 PM ET.
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