An announcement from Tesla
Tesla made the announcement on Friday that every shareholder of record on 17 August will receive a dividend of 2 new shares for each share held after the close of trading on 24 August.
The shares will trade at the new price, adjusted for the split, as early as the next day, 25 August.
The 3-for-1 stock split is essentially the issue of 2 new shares. This decision by Elon Musk is designed to support retail investors who are important to Tesla. About 46% of the company's shares available for trading are held by non-institutional investors, while institutional investors are mutual funds or hedge funds.
The last time Tesla split its shares was a 5-to-1 ratio back in August 2020, after which its shares rose 81% from announcement to trading shares on a new split-adjusted basis.
Tesla shares, which debuted at $17 apiece in 2010, rose to more than $1,200 at the end of the year after the 2020 stock split, bringing the company's market capitalisation to more than $1 trillion.
Tesla shares, which fell 6.6 per cent on Friday, are down about 18 per cent this year.
At Thursday's meeting, shareholders narrowly approved an advisory proposal that would empower investors to appoint directors, receiving 339.2 million votes for the proposal and nearly 319 million votes against it.
A shareholder proposal asking Tesla to report annually on its efforts to prevent racial discrimination and sexual harassment was defeated, with 350.7 million votes against it, against 310 million votes for the proposal.
It is worth noting that investors have been aware of this split for months, with shares up almost 25% in the last month and 40% from their yearly low in May.