Tesla stock moves higher as split takes effect
Yahoo Finance’s Brian Sozzi and Ines Ferre discuss Tesla’s 5-for-1 stock split, and what it means for shareholders.
Video Transcript
BRIAN SOZZI: Tesla's stock is also rising this morning, as the market gears up for the company's 5-for-1 stock split set to become official. Yahoo Finance's Ines Ferre is here with those details. Ines, it feels that we've been watching the stock go up in a straight line the past few months. Why? Because it has.
INES FERRE: Oh, completely, especially after the stock split was announced on August 11. The stock is up more than 45% since that announcement. This stock split has been so anticipated. So on Friday, the stock closed at $2,213.40. The now adjusted price is $442.68. You can see in premarket, it's up about 0.2%. It had been up more than 1% earlier in premarket.
The stock split doesn't change anything fundamentally for the company for the valuation. It's seen mostly as cosmetic. It's seen as a way for a wider range of investors to get a piece of Tesla to be-- especially retail investors, which are so important for Tesla, which is really known as a sort of cult stock.
And as I mentioned, the stock has rallied since this announcement. But it's also rallied throughout the whole year. I mean, you had a better than expected quarter. You have speculation of inclusion into the S&P 500. And really, analysts have raced to rerate this stock. You just had Jefferies recently that put a price target a straight high of $2,500 on this stock.
You had Wedbush's Dan Ives, which I know will be on the show later on. His bull case is $3,500 on this stock. His regular price target is $1,900. He just came out with a note this morning on an adjusted basis that would be $380 for the price target, with a bull case of $700.
And really the thesis that many of the bulls for Tesla use is saying this is not just an automobile company, this is a tech company, talking about their battery, the battery day that is expected to come in September, the possible announcement of a million mile battery.
You have the autonomous software. And one analyst from ARK Invest last week had just said, look, the pandemic has made Tesla into, has really solidified its leadership when it comes to the EV space. It's a closely watched stock. Brian.
BRIAN SOZZI: And worth noting too, this cult of Tesla has spread throughout the electric vehicle space. We saw it with the [INAUDIBLE] IPO last week. We continue to see it with in NEO. And of course, we continue to see it with Nikola. All right, Ines, we'll check back with you in a little bit.
