As of October 2024, Tesla has not confirmed any plans for a stock split. Currently, Tesla shares are trading at around $240 per share, significantly lower than their all-time high of $409.97 in November 2021.
Historically, stock splits are more likely when a company’s share price becomes too high for retail investors to afford, and Tesla’s current price may not warrant such action.
However, there are still rumors that a stock split could happen soon. Tesla’s last stock split was a 3-for-1 split in August 2022, following a 5-for-1 split in August 2020.
These splits were designed to make Tesla stock more accessible to everyday investors, and they generated significant buzz in the market.
Key Takeaways
- Tesla’s Current Stock Price: $240 (as of October 2024)
- Last Stock Split: August 2022 (3-for-1)
- Stock Splits History: August 2020 (5-for-1), August 2022 (3-for-1)
Why Doesn’t Tesla Split Its Stock Right Now?
Tesla’s stock price, while significantly lower than its 2021 peak, is still accessible to a large portion of retail investors. When Tesla performed its previous stock splits, it was trading at much higher levels, which justified the move.
Management typically considers a split when they believe it will drive more investor interest, but at the current price, a split may not provide as much benefit.
Tesla’s Financials in 2024
In 2023, Tesla reported a revenue increase of 24%, bringing total revenue to $81.5 billion. However, net profit dropped by 17% from the previous year, totaling approximately $10.5 billion.
This decline was primarily due to price cuts on Tesla’s vehicles to remain competitive in the market. The decrease in profitability raises concerns over whether Tesla is in a strong enough financial position to justify a stock split.
| Tesla Financials (2023) | Amount |
|---|---|
| Revenue Increase | 24% YoY |
| Total Revenue | $81.5 billion |
| Net Profit | $10.5 billion |
| Net Profit Decline | 17% YoY |
The price cuts, aimed at maintaining competitiveness against rivals, have put pressure on Tesla’s margins.
These financial factors may influence whether management feels confident enough to authorize a stock split in 2024.
Musk’s Other Ventures and Their Impact on Tesla
Elon Musk has numerous ventures, including SpaceX, Starlink, X Corp (formerly Twitter), and Neuralink. His time and attention are divided among these enterprises, which could mean a potential stock split for Tesla may not be his top priority.
Additionally, a stock split generally requires approval from the company’s board of directors, and they may prefer to focus on other strategies to improve Tesla’s long-term growth and stability.
EV Market Trends
The electric vehicle (EV) market is evolving rapidly. While Tesla was once the dominant player, competitors like Rivian, Lucid Motors, and traditional automakers such as Ford and General Motors have introduced more EV models to the market.
Chinese manufacturers have also stepped in with affordable electric vehicles, pushing down prices and increasing competition.
Furthermore, government incentives and rebates for EVs continue to fluctuate, affecting demand for Tesla’s products.
These external pressures may lead Tesla to focus more on maintaining its market share rather than making its stock more accessible through a split.
Will Tesla Stock Split in the Future?
While a stock split in 2024 seems unlikely given Tesla’s current financial position and stock price, it’s not entirely out of the question. Tesla may choose to split its stock again in the future, especially if its share price climbs back toward its previous highs.
Some analysts predict that a split could happen as early as 2025, once Tesla’s stock resumes its upward momentum.
Tesla’s Stock Split History
Tesla has split its stock twice:
- August 2020: A 5-for-1 split
- August 2022: A 3-for-1 split
Both splits were designed to make Tesla stock more accessible to retail investors and to create excitement around the stock.
The 2020 split saw Tesla’s stock surge by more than 36% in the six months following the split, while the 2022 split had a more subdued impact due to broader market conditions.
The Bottom Line
While no Tesla stock split is confirmed for 2024, the possibility remains. Tesla’s stock splits in 2020 and 2022 successfully created buzz and drove retail investor interest.
However, with the company focusing on profitability and competing in a crowded EV market, a stock split might not be a priority for 2024.
Investors should monitor Tesla’s financial performance and stock price movements to gauge the likelihood of a future split.
