Tesla Stock Split: DANGER or Exciting for TSLA? - YouTube

might be asking yourself why is tesla going up  today well here is exactly why sitting at one  

thousand ninety one dollars per share and it'd  be kind of cool if on this video today we see it  

break eleven hundred dollars and here's exactly  why it's going up guys it's because they just  

recently announced through their sec filings  that they want to do a stock split in the form  

of a dividend and i'll explain exactly what that  means now there is a couple things that you need  

to keep in mind first of all if you are a tesla  holder this doesn't mean that you're going to  

get paid a dividend a lot of people are thinking  oh tesla's finally going to pay a dividend so if  

you're a dividend fund investor this is actually  not true at all it's not actually a dividend  

from the standpoint of something like oh i don't  know coca-cola at t q ild something like that  

that pays a monthly or quarterly dividend that is  not what tesla is announcing they're announcing  

a stock split with a stock dividend and i'll  explain that a little bit later but if you're a  

tesla holder just get ready for that because you  also got to remember that it has to go through  

the vote the shareholder now i don't think by any  stretch of any imagination that this is going to  

be an issue where it's not going to be voted  through i really do think that stock splits  

are typically seen as favorable so i don't think  that's actually going to be a hold up the fact  

that the board has already approved a stock split  next up it's the shareholders i really don't think  

that they're going to deny this so we'll have to  keep our eyes on the news but obviously as you  

can see here especially today we're seeing quite a  run up so it's kind of been going up actually and  

you know since march 18th we're kind of shooting  up here but it's been flirting anywhere from  

about 1070 earlier today to about 10 90 where  we are here all the way up to the top at 10.97  

i would really like it to break 1100 today but  we'll have to see because there's actually a lot  

of downward pressure in the entire stock market  right now we have the ukraine thing going on  

we have you know the inflation thing going on gas  prices there's a lot of downward pressure on the  

market in transparency i do have a very small very  very small holding in tesla and i will probably  

add to that as it goes on but let's get right down  to what's actually happening right now with tesla  

when it comes down to a stock split typically  what they'll do is they'll announce maybe a  

five to one or a 20 to one in the case of actually  google and amazon right now coming up this summer  

they are announcing a 20 to one stock split so  for every one share you own you're going to get  

20 shares but your value will remain the same  so what's the difference between a stock split  

and a stock dividend that tesla just announced  well in the case of a stock dividend additional  

shares are given to shareholders whereas in  a stock split already issued shares are split  

on an agreed ratio so i mentioned earlier with  google and amazon a 20 to one split you own one  

share of google you're going to get 20 shares of  google at the same value of what you own at the  

time of the split but in the case of tesla they're  giving this as a payment through additional shares  

to the shareholders now that could actually mean  let's say you have like a thousand shares of tesla  

you end up after this is all said and done with  1200 shares so it's just something to keep in mind  

but ultimately if we go back to when they last  did a stock split back in august of 2020 let's  

take a look at what happened i'm gonna pull up  weeble right now here we are at 1089 really want  

to see that 1100 but uh we might not be lucky on  today's video but let's go back here a little bit  

and i want to go back to 2020. now they announced  and did a split so all the numbers on today's  

video will be as a result of the prior split but  you can see a lot of upward momentum between the  

period of april 2020 right here all the way up  to right about here when this happened so what  

is that like 8 28 it happened on 8 31 so right  about here is when this stock split happened  

but look what happens after that it just continues  to have a lot of positive momentum and of course  

2021 was a year like none other but it's really  nice to see that the based on what tesla has to  

bring to the table this continued an upward trend  now i gotta say i've done some really dumb things  

in my life and here i'm gonna be transparent with  you guys because i know you appreciate that here's  

something i did that i'm not too happy with back  around this time so let's go over here it's okay  

right here september 4th 2020. it's going for  at the top 500 at the low 380. now even at 380  

back on september 4th i'm thinking i don't know  that seems kind of high that seems a little bit  

expensive and i'm looking at this and if you look  at the chart if we chop off the half here to the  

right and we only look at the left-hand side you  can see it's kind of like really kind of gone  

up there and you know a lot of times i think what  we do as investors is we look here and we're like  

yeah you know i think it's kind of at a high and  it's probably due for a significant pullback or  

recession or something like that we immediately  go into this negative mindset right instead of  

looking at the fundamentals and that's where i  failed instead of looking at the fundamentals  

behind the curtain or under the hood of tesla i  decided to say you know what this seems a little  

bit expensive now if i would have just said you  know what even though it's expensive i'm going  

to buy it anyway and i bought a couple shares  at 380 you can obviously see where i'd be today  

1091 or even before this whole surge came up  let's go back here to the end of 2020 at 582.  

so i would have gone from 380 a share to 582 which  means let's get to the point of show me the money  

and in this segment of tesla we're going to look  at the money aka the fundamentals behind tesla to  

see if this is actually a buy or something  to avoid i'm just going to go over here to  

seekingalpha.com because it's free and i'm making  it easy for you guys to look at the fundamentals  

so i'm going to type in tesla t-s-l-a we're going  to click on that and we're going to go through  

the smart steps and i'm going to take  you through exactly what i look at here  

first thing i look at is the p e ratio p e ratio  right now as of seekingalpha.com sitting at 94.78  

now if you are looking for something that's  value for the long long term you got to be  

careful of something that's overvalued but  i'll say you know i look for 15 to 16 pe  

however with everything that's going on with tesla  and the potential growth mechanisms within tesla  

i'm going to say that even though 94 could  actually be a red mark on the p e ratio i'm going  

to give it a yellow and the reason i'm giving it  a yellow is just because of the fact that there's  

i think a lot of other great things that when it  comes down to tesla that we need to keep in mind  

and a lot of it is its upcoming growth in the  electric vehicle sector so more on that in just  

a moment the next thing i want to look at is the  revenue growth because if they're not growing the  

revenue they might be uh having some issues is it  going to be yellow is it going to be red all you  

have to do right here on seeking alpha is right  here at the top go to financials click on that  

and then right now of course you can upgrade  to get all the additional data what i'm going  

to look at right now is just the difference  between what they give me so we have 2017  

to 2021 are we seeing growth holy crap are  we ever we are seeing and these figures are  

in the millions look at this we're going from  11.7 billion dollars all the way up to 53.8  

that is a significant amount of growth and that  means that revenue from a tesla perspective is a  

green light i love the fact that we're seeing some  significant growth revenue looking really nice and  

sexy next up let's talk about profit margin of  tesla because you got to think about like you can  

get as much revenue in the world as you want but  if you don't have good profit if your margin isn't  

good i get a little bit worried now when companies  are first starting off of course they could be  

negative on this but the goal would be how is your  deliverables how is your growth and everything  

in between but right now for tesla since they've  been in the game for a while i do want to see some  

positivity on that profit margin 10 or more is  always a good thing so how you figure out profit  

margin in case you're not aware is you take the  net income of the company and then you divide that  

by the total revenue so i'm going to say total  rev okay and we can find that again on seeking  

alpha let's go to the net income right here  we're still in the financial income statement  

we come down here to net income let's look  at the very last statement so we have five  

five one nine and we're going to  divide that by total revenue of 53

823 which is actually 53 billion 823 million  so i'm going to take out my calculator and  

do five five one nine divided by five three eight  two three that gives me a total of a ten point  

two percent profit margin which means profit  is also in the green so this is looking very  

good so far let's move on to the next step i like  to look at their debt load so this is basically  

their assets versus their liabilities if they  totally get rid of all of their assets all of  

the liabilities what does that look like now  what i want to do for this one you can always  

find this of course in seeking alpha but i want to  talk a little bit about weeble weibo right now is  

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description below and then once you do you can get  your very own weibo account and within your weibo  

account you can then do a little bit of this own  research so if i wanted to see their debt versus  

liabilities in this particular example here's  what we want to do so within weibo all i have  

to do is pull up this screen right here go over  to the company tab right there at the top you see  

that click on that and then right here at the very  bottom click on financial details you can do a lot  

of the research that we're doing here in today's  video on the fundamentals on the show me the money  

right here on weeble so what i want to do is come  down here to the balance sheet now look at this  

right here you can see their total assets their  total liability and their debt to asset ratio  

and this is exactly what we're looking for in this  particular analysis so if we looked at fiscal year  

2021 they had 62.13 billion of assets and 30.55  billion of debt or liabilities which means that if  

they sold everything they would still be positive  on their overall balance sheet that is great  

that's what we want to see and guess what that  does that gives them yet another green light right  

here under the debt that is great news that's what  we want to see last thing let's look at the eps  

now that's earnings per share so if we look right  here on the weave i'm going to use this again  

actual versus estimate you can see that estimate  is that slight gray line and we're tracking all  

the way back quarter one 20 21 all the way forward  to quarter one 20 22 which is not yet announced  

however look at the blue line on the earnings  per share it's actually exceeding the estimates  

another great great option so we're going to go  ahead and also say that that is a green mark now  

i will tell you tesla could be considered a little  bit overvalued based on the p e ratio right here  

however there's a lot of things you also got to  look at is the growth of this particular company  

there's a lot of good things going on with it  so what i would recommend doing is keeping your  

eye on the news keeping an eye on their statements  are they continuing to exceed their revenue exceed  

their profit keep their debt in line and keep  their earnings per share what we don't want to see  

is their balance sheet get out of whack as they  continue to expand is there a potential where  

they're taking on too much debt which then you  need to as a smart investor try to figure out  

what they're doing and what they're spending  all their capital on is that what i feel good  

about when it comes down to what they're going to  produce in the future and that's kind of the key  

point so there's obviously more to it than just  the stock split i hope this was helpful if it was  

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