Tesla wants to split its stock so it can pay a stock dividend; shares gain

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  • The SEC filing said the electric car maker will ask at its annual shareholders meeting “for an increase in the number of authorized shares of common stock … in order to enable a stock split of the company’s common stock in the form of a stock dividend “
  • Tesla last split its stock in August 2020. The shares have more than doubled since that 5-for-1 split took effect on Aug. 31, 2020.

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Tesla wants to split its stock so it can pay a stock dividend to shareholders, according to a filing Monday.

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The Securities and Exchange Commission filing said the electric car maker will ask at its annual shareholders meeting “for an increase in the number of authorized shares of common stock … in order to enable a stock split of the Company’s common stock in the form of a stock dividend.”

A stock dividend is a dividend paid to shareholders in the form of additional company shares instead of cash. These dividends do not affect the value of a company, but they dilute its share price.

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Tesla’s shares were up more than 5% in premarket trading to about $1,066.

The company last split its stock in August 2020. The shares have more than doubled since that 5-for-1 split took effect on Aug. 31, 2020.

The news comes as Tesla’s stock has struggled this year, slipping 4.4% for 2022 through Friday’s close. That said, it jumped 49.8% in 2021 and surged 743.4% in 2020. The shares have also risen in each of the last five years.

The move also follows a Bloomberg News report that said Tesla will halt production at its Shanghai factory due to a Covid-19 lockdown in the city.

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Credit: www.cnbc.com /

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