Tesla stock set for 3-for-1 split after market close

17 May 2021, Brandenburg, Grünheide: Elon Musk, Tesla CEO, stands on the construction site of the Tesla factory and greets with his hard hat.

After the market closes on Wednesday, investors in Musk's company will get two more shares. They will start trading on a split-adjusted basis.

Even though the stock split won't change anything fundamental about the company's stock, the shares were up almost 2% Wednesday morning.

The shareholders voted to approve the 3-for-1 stock split at the company's annual meeting.

The split means that more retail investors will be able to afford the company's stock, but those investors are small compared to institutional investors, and fractional shares were already available to smaller investors.

In a proxy filing earlier this year, it was stated that the new split was intended to help the company "offer every employee the option of receiving equity" and "reset the market price" of its common stock to give employees "flexibility in managing their equity."

The investors will get two more shares of the company for every one they already own.

The last stock split was in August 2020.

A stock split is something you need to know.