Tesla Extends Rally, With Gain Approaching 50% From Low in May

(Bloomberg) -- Shares of Tesla Inc. are nearing a 50% gain from lows touched in May, ahead of a shareholder vote later this week on the electric-vehicle maker’s stock-split plan.

The shares jumped as much as 5% to $935.63 on Monday, marking a gain of 49% from the May 24 close of $628.16. They pared most of those gains to close barely changed at $891.83. Tesla is coming off a 32% gain in July, its best month since October 2021.

The Elon Musk-led carmaker will hold its annual general meeting on Aug. 4, where its investors will get to vote on a 3-for-1 stock split plan. If approved, it will be Tesla’s second share-split in less than two years. The company had executed a five-for-one stock split in 2020, a move that led to a 60% surge in the share price from the day of the announcement to the execution date.

The exuberance for Tesla comes amid a broader wave of optimism in the US stock market. The S&P 500 Index rose 9.1% in July for its best month since November 2020, while the Nasdaq 100 Index surged 13% for its best monthly performance since April 2020.

But Tesla’s rally has been even more impressive, helping to almost wipe out its underperformance against the S&P 500 this year. The stock is now down about 16% this year, while the broad equities benchmark has fallen about 14% for 2022.

(Updates stock moves in second and fifth paragraphs.)

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Author: Esha Dey