But with fears plaguing investors about the Federal Reserve, inflation and the economy, those days may be over.
Tesla announced on Friday that it would ask investors to split their shares 3-for-1 at its annual shareholders meeting in August. However, shares were little moving after Friday, falling ahead of the market on Monday. Shares are down more than 30% since the company first announced its stock split in late March.
In a 5:1 split, someone who owns one share priced at $100 would instead get five, valued at $20 each. A 3:1 split would split three shares worth $33.33.
That may not sound like a big deal. Historically, however, this has helped drive demand as stocks become more accessible to regular investors.
It also increases the likelihood of companies being included in the Dow Jones Industrial Average, which tends to include cheaper stocks. Apple announced a 7-for-1 stock split in 2014 and joined Dow in 2015.
In today’s market environment, it’s hard to get anyone excited about Tesla or many of their fast-growing peers. Amazon’s 20-for-1 stock went into effect last Monday. Its shares were still down 25% year over year. Alphabet, owned by Google, will split its shares 20-to-1. Shares have fallen 23% this year. All three companies were hit on Friday after government data showed US consumer prices rose at their fastest rate in 40 years. The consumer price index rose 8.6% in the 12 months to May.
It closed the S&P 500 Index’s worst week since January. He fears that higher inflation will force the Federal Reserve to raise interest rates more aggressively. If interest rates rise, it will hurt stocks like Tesla, which are priced on expectations of longer-term growth and earnings potential.
Tesla has already seen tons of money drained from its awards this year. It was worth $1.15 trillion in January. Now its market value is $722 billion.
CEO Elon Musek’s recent warning that he has a “super bad feeling” about the economy, coupled with confusion over whether he plans to cut jobs at the automaker, didn’t help. Federal investigators also said last week that they are expanding their investigation into Tesla vehicles that crashed into parked first-aid vehicles.
At some point, bargain hunters may emerge on Wall Street and bring bottom under stocks that have been hit hard by a recent sell-off. But this moment has not yet come – even with the distribution of the shares on the table.
Gas came in for $5. There’s $6 around the corner
Over the weekend, the nationwide average price per gallon of regular gasoline hit $5 for the first time as drivers at the gas station braced for a painful summer. Gas prices have risen steadily over the last eight weeks. The latest milestone, reached on Saturday, marked the 15th consecutive day that the AAA reading set a record.
The average price per gallon of gasoline was $4.42 a month ago and $3.08 a year ago. However, the pandemic and war in Ukraine disrupted energy supplies and caused prices to rise sharply.
Rising fuel costs are a big part of why inflation is rising so fast in America. Energy prices rose nearly 35% over the year to May, according to data released Friday.
This raises concerns about consumers becoming more environmentally friendly, which would drag the economy down. Consumer confidence hit a record low on Friday, according to a University of Michigan survey.
Gas prices are unlikely to stop rising. As the summer travel season begins, the demand for gasoline skyrockets. And while some oil producers have promised to increase supplies, they’re unlikely to make up for shortfalls if Western traders turn their backs on Russian oil.
The US national average for gasoline could approach $6 by the end of this summer, according to Tom Kloz, global head of energy analysis for the Oil Price Information Service.
“Everything goes from Labor Day to June 20,” he said of gas demand last week as people embarked on a long-awaited flight. “Hell or high gas prices, people are going to take vacations.”
The highest nationwide average price is in California. It cost $6.43 a gallon on Saturday
There really are more weddings this year
Browsing social media recently, I had to ask myself: will more people be getting married this year?
Signet Jewelers, which recently reported quarterly sales, has a clear answer: yes.
The world’s largest diamond jewelery retailer has said weddings are at a 40-year high after a drop in the coronavirus.
“We’ve seen an increase in wedding rings, anniversary bands, bridal jewelry, bride and groom gifts and the like,” CEO Signet told analysts.
The company said it is working hard to persuade people who come to buy engagement rings to return for their wedding bands. According to Signet, contracts are expected to return to pre-pandemic levels this year.
Shares rose last week after the company beat Wall Street’s earnings expectations. But they fell more than 20% year over year as diamond prices rose.
Oracle (ORCL) announces results after US markets close.