Reuters
- Tesla has been rallying since announcing on Tuesday that it would end a 5-for-1 action split in late August.
- Shares of motorist jumped 13% on Wednesday and climbed as much as 6% on Thursday.
- The stock split does not fundamentally change the company, but should appeal to smaller investors.
- Watch Tesla trade live on Markets Insider.
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Tesla has joined forces as investors cheer on the company’s announcement that it will split its stock at the end of the month.
On Wednesday, a day after the company announced a 5-for-1 share split, Tesla shares jumped 13%. The automaker’s profits continued on Thursday, with shares rising to 6%, bringing the total to 20% in two days.
The stock split does not fundamentally change anything about the company. But a lower price per share would have to appeal to smaller investors who may want to own Tesla stock but can’t afford the roughly $ 1,600 share price. Tesla said the stock split was designed to “make equities more accessible to employees and investors.”
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At the end of trading on August 28, Tesla shareholders will receive four additional shares for each share they own. The split shares will begin trading at the new price on August 31, Tesla said. That split at Wednesday’s closing price would appreciate shares at roughly $ 310.
Tesla stock has been on a downward spiral this year, driven by solid car sales, blockbuster earnings, and its eligibility for inclusion in the popular S&P 500 index.
Tesla is up about 280% year to date.
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