Tesla (NASDAQ:TSLA) has big news for investors today. Since rumors of a proposed TSLA stock split first broke in March, many have been waiting for confirmation. Now, the electric vehicle (EV) leader has announced that its 2022 Annual Shareholder Meeting will take place on Aug. 4 in Austin, Texas.
Today, TSLA stock is rising following the news. This morning, Tesla announced both the date and location for the shareholder meeting. At the meeting, shareholders will vote on the potential stock split. Although the vote is expected to swing in favor of the split, the split cannot proceed without majority shareholder approval.
Tesla's 2022 Annual Shareholder Meeting will be on August 4th in Austin, TX. Thank you for your support of Tesla!
— Tesla (@Tesla) May 3, 2022
Of course, this Tuesday has been turbulent for many stocks, but TSLA is rising nevertheless. Shares shot up some 2% and, despite a dip, have since rebounded. As of this writing, the stock is up by about 1% for the day.
What’s Happening with TSLA Stock?
It’s not surprising that TSLA stock is rising on this stock split update. Last time Tesla enacted a stock split, shares soared more than 80%. In the ensuing year, its price more than doubled. All told, the first split was excellent for both investors and the company.
Now, Tesla wants to split the stock again — and shareholders have the power to make it happen. So far, there’s little reason to expect a resounding “no” on the split, either. What’s more, while another doubling in price is not guaranteed, the second stock split should still help shares rise. Companies typically split their stock to make it more accessible to small-scale investors. Given the high levels at which TSLA stock currently trades, opening shares up to new group of investors should prove very beneficial.
Wall Street often regards stock splits as signals that management has positive expectations. To that end, CEO Elon Musk has made it clear he has no intentions of slowing Tesla down.
The company hasn’t released many other details about the upcoming stock split. As we’re seeing today, though, even small updates can generate buzz.
What It Means
While investors wait for more details on the Tesla stock split, shares can be expected to continue rising. Stock splits have worked well for other high-growth tech stocks; Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN) both enacted splits in the past year, leading to significant gains.
Now, Tesla is following in their footsteps, also standing to benefit. The upcoming TSLA stock split will likely go through — and when it does, investors will be happy with the results. In the months leading up to the shareholder meeting, investors can also expect TSLA stock to climb in anticipation.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.