Tesla announced a 5-for-1 stock split late on August 11, “to make stock ownership more accessible to employees and investors”.
Why it matters: Tesla’s stock has been red hot since retail investors turned to Big Tech in droves since the Covid-19 stock market selloff in March. From a trough of $361.22 in mid-March, TSLA shares skyrocketed to a peak of $1,643 last month July. The company and its stock is beloved by techies the world over, driven by admiration for founder Elon Musk and love for Tesla’s products.
Investors are bullish about Tesla’s prospects most notably because of its aggressive expansion into China. The company is also making inroads into Singapore, where Musk had once decried as unsupportive of electric cars.
Musk had in 2018 tweeted: “We tried, but Singapore govt is not supportive of electric vehicles” in response to a call from a user to get Tesla cars into Singapore.
Tesla’s stock is embraced by both institutional investors and retail investors because of the potential disruptive qualities of the company and its products. SpaceX, another company founded and led by Musk, is a leader in the aerospace industry.
Tesla’s electric vehicles faces a lot of competition, however, from competitor’s such as Rivian (reportedly backed by Amazon’s Jeff Bezos) and Chinese company Xpeng, which is reportedly seeking to seek a US IPO. Tesla is embroiled in a lawsuit against Rivian for stealing its trade secrets.
Another competitor, Electric truck maker Nikola, also recently “announced an order for 2,500 garbage trucks”. Tesla’s stock price is current on a slight decline at the close of Tuesday trading at $1,374.39.