Tesla splits its stock and sees another bump
Tesla's share price jumped in after-market trading following the Silicon Valley electric automaker's announcement of a 5-for-1 stock split.
Why it matters: The company's Tuesday evening announcement said the move is aimed at making stock ownership "more accessible to employees and investors."
- The company's stock price has surged this year and closed yesterday at $1,374-per-share, which is three times higher than where it started in 2020.
- The stock is up almost 7% in premarket activity this morning.
The big picture: "For Tesla, it helps defend against claims its stock price is inflated by reducing the total cost of one share by 80 percent and giving the company the appearance of having more affordable and accessible shares," The Verge reports.
Yes, but: Reuters notes that "brokerages increasingly let customers buy parts of shares, making the benefit of share splits less clear than in the past."