Tesla (NASDAQ: TSLA) has reported that its board of directors has approved a 5:1 split in the form of a dividend for the company’s common stock. The move would make TSLA stock ownership more affordable to both employees and investors alike.
The electric car maker said that on August 21, 2020, each stockholder of record would receive a dividend of four additional common stock shares for each share owned by the investor on that date. This will be released on August 28, 2020, after the closing bell.
On the next trading day, which is Monday, August 31, trading will then begin on a stock-adjusted basis.
Stock splits, or stock shares, are used to increase a company’s share count. The act of splitting a stock will lower the market price of individual shares, but it will not affect the company’s overall market capitalization.
The change allows smaller investors to afford TSLA stock which has tripled since the start of the year.
TSLA stock closed today at $1,374.39, but aftermarket trading boosted the stock price by almost 6%. The stock was valued at $1,459.10 at the time of publication.
The announcement by Tesla on stock split can be found below.
PALO ALTO, Calif., Aug. 11, 2020 (GLOBE NEWSWIRE) — Tesla, Inc. (“Tesla”) announced today that the Board of Directors has approved and declared a five-for-one split of Tesla’s common stock in the form of a stock dividend to make stock ownership more accessible to employees and investors. Each stockholder of record on August 21, 2020, will receive a dividend of four additional shares of common stock for each then-held share, to be distributed after close of trading on August 28, 2020. Trading will begin on a stock split-adjusted basis on August 31, 2020.
Certain statements, including, without limitation, statements regarding the expected timing and impact of the stock dividend are “forward-looking statements” that are subject to risks and uncertainties. These forward-looking statements are based on management’s current expectations. Various important factors could cause actual results to differ materially, including the risks identified in our filings with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the quarter ended June 30, 2020. Tesla disclaims any obligation to update this information.
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