Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Tesla dips after Musk sheds $5 billion in shares

Stock MarketsNov 11, 2021 06:41PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A Tesla logo is seen at the Tesla Shanghai Gigafactory in Shanghai, China January 7, 2019. REUTERS/Aly Song

By Tom Westbrook and Medha Singh

(Reuters) -Tesla's stock declined slightly on Thursday after filings revealed Chief Executive Elon Musk sold about $5 billion worth of his shares https://www.reuters.com/business/autos-transportation/tesla-selloff-puts-risk-its-1-trillion-club-membership-2021-11-10 this week following his much-hyped Twitter (NYSE:TWTR) poll https://www.reuters.com/business/tesla-shares-fall-after-musks-twitter-poll-backs-stake-sale-2021-11-08.

The electric-car maker's stock ended the session down 0.4% at $1,063.51 after tumbling earlier in the week.

Musk's share sale was his first since 2016 and comes after his weekend poll of Twitter users about offloading 10% of his Tesla (NASDAQ:TSLA) stake, which comprises most of his estimated $281 billion fortune.

"I don't think investors are reading in to the news negatively," said Oliver Pursche, senior vice president and adviser at Wealthspire Advisors in New York. "If you believe in the Tesla story, this should not impact you or change your mind."

Tesla's stock is in portfolios utilized by Wealthspire, Pursche said.

Filings showed Musk's trust sold nearly 3.6 million shares of Tesla, worth around $4 billion, while he also sold another 934,000 shares for $1.1 billion to cover tax obligations after exercising options to acquire nearly 2.2 million shares.

The sale equates to about 3% of Musk's total holdings. The options-related part of the sale was put in place in September, well before his Twitter poll.

Before the sale, Musk owned a 23% stake in Tesla, including stock options. He also owns other companies including SpaceX.

Musk's move to sell his Tesla shares comes as U.S. Senate Democrats propose taxing the stock holdings of billionaires to help finance President Joe Biden's social spending plan.

"Elon Musk doesn't take a salary, he's paid in big chunks of stock. At some point in time you have to take some of that concentration down," said Art Hogan, chief market strategist at National Securities in New York.

"This is not novel. It just gets more attention because it's such a high market-cap type, attention-grabbing kind of company."

With nearly 800,000 options, or about 12% of Tesla's open contracts, set to expire at the close of trading on Friday, some analysts have pointed to the potential for additional near-term volatility as investors and options dealers make adjustments to account for expiring positions.

Tesla did not respond to a request for comment.

EV MANIA

Tesla this week has lost $157 billion in stock market value, more than the combined market capitalizations of Ford Motor (NYSE:F) Co and General Motors Co (NYSE:GM). At the same time, demand for shares of electric vehicle makers has heated up.

Shares of Rivian Automotive Inc jumped 22% a day after a stellar market debut that sent the company's valuation over $100 billion. Lucid Group surged 10%.

Underscoring retail investors' thirst for EV stocks, Rivian, Tesla and Lucid made up three of the four most-traded stocks on Fidelity's brokerage website on Thursday, with buy orders outnumbering sell orders.

Wall Street's biggest institutional investors, including T. Rowe Price and BlackRock Inc (NYSE:BLK), are betting on Rivian to be the next big player in a sector dominated by Tesla, amid mounting pressure on automakers in China and Europe to eliminate vehicle emissions.

"Rivian’s valuation makes it a legitimate option for institutional investors who have previously only had Tesla to play the electric vehicle space," wrote Nicholas Colas, co-founder of DataTrek Research, in a recent note.

Four former and current Tesla board members, including Musk's brother, Kimbal Musk, have filed to sell nearly $1 billion worth of shares since Tesla's market value surpassed $1 trillion late last month, according to filings and market data.

Tesla's share price has made staggering gains over recent years and has epitomized the ebullient mood in U.S. markets and the optimism of small-time traders who have helped drive it up 51% this year and 1,300% from 2020 lows.

Tesla dips after Musk sheds $5 billion in shares
 

Related Articles

High-end cognacs lift spirits at Remy Cointreau
High-end cognacs lift spirits at Remy Cointreau By Reuters - Jan 25, 2022

By Dominique Vidalon PARIS (Reuters) -Remy Cointreau is confident demand for its premium cognac in China, the United States and Europe will underpin profit growth this year after...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
Kevin Avila
Kevin Avila Nov 11, 2021 6:56PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Tesla is the iPhone of EVs… Don’t get confused. When they start releasing their less crazy models their business will takeoff.
Kaveh Sun
Kaveh Sun Nov 11, 2021 9:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Dont matter how many he sells. The matter is the public. Right now the public is seeing a few years down the road, everthing will be EVs.
Momentum Tradarn
Momentum Tradarn Nov 11, 2021 9:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
You mean 15 years? At this ridicolus high value.
Mark Wahba
Mark Wahba Nov 11, 2021 9:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
By 2035 Prob. 2030 is when companies will only produce EVs. right now it only accounts for 3% of market
Fabrizio Fusaro
Fabrizio Fusaro Nov 11, 2021 9:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Mark Wahba let’s say almost 2%
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email