Tesla has announced it will ask its shareholders to vote on a 3-for-1 stock split at its upcoming annual meeting. 

Following up on the announcement made in March, when it confirmed plans for a stock split, the company has released details about the move in its prospectus for the 2022 annual shareholders meeting. 

The proposed 3-for-1 stock split means that shareholders who own one Tesla share will get two more, with all three shares valued the same as the initial share. The main objective with the stock split is to lower the price per share, making the common stock more accessible to retail shareholders while also giving Tesla employees more flexibility in managing their equity.

Tesla, unlike other manufacturers, offers every employee the option of receiving equity, but the company notes that since the previous stock split in August 2020, its stock price has risen 43.5% (as of June 6, 2022). 

"While this value appreciation has led to our employees benefiting enormously through the years, we want to make sure all employees, no matter when they join, have access to the same advantages. We believe the Stock Split would help reset the market price of our common stock so that our employees will have more flexibility in managing their equity, all of which, in our view, may help maximize stockholder value."

At the time of the last stock split in 2020, Tesla's stock was trading at around $1,300 a share, but the stock-split announcement boosted the price to a record high of $2,000 a share. After the split, the price per share was reset at around $460, with Tesla's valuation reaching approximately $430 billion. 

The company's stock currently trades at just under $700 per share while the market capitalisation is $720 billion. A 3-for-1 stock split applied today would result in a price of $233 per share.

Tesla will ask shareholders to vote on the stock split proposal via an Authorized Shares Amendment at the 2022 annual meeting of stockholders to be held on August 4, 2022, at 4:30 pm Central Time. Shareholders will be able to attend the meeting virtually via the internet or in person at Tesla's Gigafactory Texas (for a limited number of people only).