5:1, 3:1 Splits: Super Auto & Energy Stock Related To Elon Musk, Gives 850% Returns In 5 Years; Time To Buy?

Tesla Inc., an American multinational automotive and clean energy company, rallied by nearly 2% to hit an intraday high of $179.81 overnight. But Tesla stock's long-term gains are robust, making this Texas-based electric vehicles maker, a multi-bagger. Listed on the Nasdaq, Tesla shares have skyrocketed by a whopping nearly 850%.

From solar panels to batteries busineses, Tesla shares have come a long way. 5 years ago, Tesla was below $19, and now, the stock is flirting near $180 levels. In 5 years, Tesla shares have multiplied by 9.5-fold, or risen by 849.36% on the Nasdaq compared to $18.94 levels on March 8, 2019.

And this long-term journey is even sweeter for those investors who were eligible for Tesla's stock splits, especially the ones who entered this stock in the early days of Covid.

A couple of months later the first wave of the COVID-19 pandemic that brought the world to a standstill from March 2020 to early 2021, Tesla decided to carry its first stock split. It was August 31, 2020, when Tesla split its 1 existing share into 5, a ratio of 5:1. While the second stock split was done on August 25, 2022, in a ratio of 3:1.

An Example:

So let's suppose, you held 500 shares of Tesla on March 8, 2019. Your investment value would have been $9,470 (500 X $18.94).

Adjusting to the first stock split, 500 shares of Tesla multiplied by 5 times, increasing the total shareholding to 2,500 shares (500 x 5) in the company. Let's say, you stayed on your position in Tesla until 2022, during the second stock split. Then your shareholding will rise by another 3 times. So, 2,500 shares will multiply to 7,500 (2,500 x 3).

And if you continued to stay invested with Tesla shares right from March 2019 to date, then you're in for a treat. Because the 7,500 shares are now valued at $13,48,575. That's a multi-fold jump.

Should You Buy Tesla Shares?

At the latest, Morgan Stanley has trimmed its target price on Tesla to $320 from an earlier $345. Notably, this is still one of the bullish targets on Nasdaq. As per reports, Morgan Stanley's Adam Jonas has expressed concerns related to continued dull demand in the electric vehicles market despite price cuts.

Also, as per Tip Ranks, based on 35 Wall Street analysts offering 12-month price targets for Tesla in the last 3 months. The average price target is $210.78 with a high forecast of $320.00 and a low forecast of $23.53. The average price target represents an 18.02% change from the last price of $178.60.

In the fourth quarter, Tesla produced approximately 495,000 vehicles and delivered over 484,000 vehicles. In 2023, vehicle deliveries grew 38% YoY to 1.81 million while production grew 35% YoY to 1.85 million.

The world's fourth richest man Elon Musk is the CEO of Tesla. His net worth is currently ay $189 billion.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.