Tesla Share Price Splits as EV Competition Grows

The Tesla share price will begin Monday’s trading session as a $400 stock once more as the company completes a 5:1 stock split. Investors in the company at the cutoff date of August 28th will receive 5 shares for every 1 they held.

The stock split marks another milestone for the company, which is up 400% on the year in a remarkable performance, with the company also registering a fourth-straight quarter of profit. Tesla’s market capitalization is now over $400 billion and the company has set September 22nd as the date for its “battery day”. The event will showcase its latest technologies and investors will be hoping it provides another bullish catalyst.

Tesla’s price-to-earnings ratio is now at 227x current earnings and the company are starting to see competition from European carmakers. Data from Jato showed that Tesla’s share of the European car market is slowing, despite European EV registrations hitting a record high in July. Tesla’s drop in share was partly driven by delays related to the shutdown of the company’sFremont, California plant over a virus outbreak, but it also highlights that there are a rising number of competitors bringing Electric Vehicle models to the market and European lawmakers may bring subsidies in the future to assist the rollout from companies such as BMW and Volkswagen.  Tesla’s performance has also led to investment flows into other new EV companies such as Nikola and China’s NIO Inc.

Tesla Technical Outlook

Tesla was lower on Friday after a push through the $2000 level on the week to $2214. The stock will now trade with a fresh price chart but the chart below can be used as an indicator of the company’s market cap. The $2000 level would be support and a failure of that level would see the price move back into the price channel. Tesla could see a correction ahead as the company’s earnings multiple has started to become expensive, while competition in Europe is building.

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Tesla Daily Chart

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