However, Tesla has announced its shares will undergo a five-way split on August 28th. In practice, those who own Tesla stock on August 21 will receive four additional Tesla shares per share after trading closes on August 28, 2020.
The five-for-one stock split announced Tuesday won't change how much Tesla's business is worth, but will automatically reduce the price of its shares by 80 per cent when it's completed on August 31.
"The move makes sense for Tesla, as it will make its shares cheaper and more accessible to young first-time retail traders using platforms like Robinhood", said Jesse Cohen, senior analyst at Investing.com. The share price sat at $US1,374.39 at market close. The trading of the stocks after the split will begin on the last day of trading this month.
Tesla said Tuesday that it was pursuing a five-for-one stock split following a massive rally in its share price this year.
The split means the price of each share in the company will be reduced by 80 percent.
Tesla Inc.is splitting its richly valued shares in a 5-for-1 exchange, a move created to make the stock less expensive for individual investors after the company become the world's most valuable automaker.
The idea of splitting stock is not to reduce the value of the company as a whole, however.
Shares rose as much as 6% in late trading Tuesday after the split was announced. Tesla's stock price has jumped 280% since March this year.
While the value of each share will be split in five, it will mean there are five times more shares than there were before - so the total value of all Tesla shares should remain the same. Apple also cited accessibility for investors as a primary reason for the split.