As Tesla Prepares to Split Stocks, Here’s How $1,000 Each Invested in Amazon, Alphabet Before Their 2022 Stock Splits Would Be Worth Today

Tesla, Inc. TSLA the shares will begin trading on a split-adjusted basis on August 25. The stock is expected to trade on the eve of the split.

Incidentally, two other great technologies – Amazon.com, Inc. AMZN and Alphabet, Inc. GOOGL GOOG recently split their shares. Does the post-split trade in these stocks have any reading for Tesla?

It could be a “yes” and a “no”. Tesla isn’t strictly a tech company, and its date with tech is mostly through the self-driving technology it promotes for its electric vehicles and its use of AI for the same.

However, Tesla is another large cap, as are Amazon and Alphabet. Another factor in favor of the three stocks is the sentiment of optimism that has returned to the market following the recent data point from Main Street showing a drop in inflationary pressure.

Amazon since the announcement of the split: E-commerce giant Amazon announced a 20-for-1 stock split on March 9. The board also approved a $10 billion share buyback program.

The stock began trading on an allocation-adjusted basis on June 6.

Assuming $1,000 was invested in Amazon stock coinciding with the announcement of the split, an investor would have had 7.2 shares, based on the adjusted closing price of $139.28 on March 9. The same shares would now be worth $1,033.56, a yield of 3.5%.

If someone had invested $1,000 just before the stock split took effect, they would have earned a return of 17.3%.

Read Benzinga’s story on Tesla’s stock outlook after stock split announcement

Announcement of the alphabet since the split: Alphabet has also split its shares at a 20-to-1 ratio this year, with news of the corporate action coming on February 1. The stock began trading on an allocation-adjusted basis on July 18.

Someone who invested $1,000 in Class A shares of Alphabet around the announcement of the split would have received 7.3 shares. At Friday’s closing price, those stocks would have returned $884, a negative return of 11.6%. Furthermore, the market was in the doldrums until the first half due to macroeconomic and geopolitical uncertainties.

Alternatively, if $1,000 had been invested in the shares before the stock split took effect, it would have generated a return of 8.9%.

The Telsa split could be a different story: If the economic fundamentals don’t deteriorate and the market can sustain the recent bullish momentum, it’s possible that Tesla will rally through August 25 and possibly beyond.

Future Fund’s Gary Black said he sees Tesla stock recovering the $926 level it closed on Aug. 4, the day before Elon Musk started selling Tesla shares again. Musk sold shares on August 5, 8 and 9.

“No reason TSLA can’t recoup $926 in a 3:1 split on 8/25, macro permitting,” Black said.

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