Tesla added about $84 billion to its stock-market value on Monday, more than Ford Motor Co.’s entire market capitalization, after the electric-vehicle maker said it is planning a second stock split in about two years.
Tesla said in a filing it would hold a vote at its upcoming annual shareholder meeting to increase the number of authorized shares in order to enable a stock split.
The news, announced via a tweet, helped to add further fuel to a recent rally in Tesla’s stock. The company is the biggest gainer on the NYSE FANG+ Index this year. On Monday, the shares closed up 8% at $1,091.84, the highest level since Jan. 12.
The last time Tesla split its stock was in August 2020. Its share price rose a staggering 743% that year, and the split was often cited among one of the reasons that drove the gains.
Companies split their shares to make their stock prices appear less expensive and appeal to more investors. However, splitting a stock does not affect its underlying fundamentals.
Tesla was the most traded stock among Fidelity’s online brokerage customers on Monday, with buy and sell orders almost evenly split, suggesting retail investors are cautious about the company.