Tesla wants to split its stock so it can pay a stock dividend to shareholders, according to a filing Monday.
The Securities and Exchange Commission filing said the electric car maker will ask at its annual shareholders meeting “for an increase in the number of authorized shares of common stock … in order to enable a stock split of the Company’s common stock in the form of a stock dividend.”
A stock dividend is a dividend paid to shareholders in the form of additional company shares instead of cash. These dividends do not affect the value of a company, but they dilute its share price.
Tesla’s shares were up more than 5% in premarket trading to about $1,066.
The company last split its stock in August 2020. The shares have more than doubled since that 5-for-1 split took effect on Aug. 31, 2020.
The news comes as Tesla’s stock has struggled this year, slipping 4.4% for 2022 through Friday’s close. That said, it jumped 49.8% in 2021 and surged 743.4% in 2020. The shares have also risen in each of the last five years.
The move also follows a Bloomberg News report that said Tesla will halt production at its Shanghai factory due to a Covid-19 lockdown in the city.