Between Monday and Wednesday, Tesla CEO Elon Musk sold almost 20 million shares of the company’s stock. According to a regulatory filing, the deal is valued approximately $3.5 billion. Musk’s latest stock dump comes after he sold over $4 billion in shares last month.
Musk has not stated publicly why he is selling shares this time, nor has he stated whether he is finished for the day. In April, Musk sold $8.5 billion in Tesla stock, and in August, he sold another $7 billion.
The sale comes as Tesla investors express concern about Musk’s connection with Twitter, which he recently acquired in a contentious and costly deal. Investors argue that Musk’s connection with the social networking site is detrimental to Tesla, which they support with data from the company’s stock price.
Tesla stock was trading at $156.80 after hours on Wednesday, down 60.8% from January and on course for their worst full-year performance.
Some analysts believe Musk’s stock sell today is his response to some of the hefty interest debt he’s paying on his $44 billion Twitter buy. As part of the purchase, Twitter took on $13 billion in debt, including around $3 billion in unsecured debt at an interest rate of 11.75%.
Investors say the sale did not appear to be premeditated, and it is unclear whether Musk is done selling. However, Musk only has until Friday to sell more stock before Tesla enters a hiatus for the end of the quarter. Some investors have expressed dissatisfaction with Musk’s erratic stock sales. He stated years ago that he would not sell stock. Musk stated he was done selling when he went back on that earlier this year. But, he goes ahead and dumps stock three times in a row.
The stock sale also comes as some of Tesla’s most ardent shareholders implore Musk and the board of directors to consider buying back shares as the company’s stock price continues to fall. Musk stated on Tesla’s third-quarter results call that the business plans to conduct a stock purchase next year, probably between $5 billion and $10 billion.
Musk’s recent stock drop coincides with the Federal Reserve raising its benchmark interest rate to a range of 4.25% to 4.5%. Stock prices frequently fall as interest rates rise, so Musk may have sold in expectation of Tesla stock losing further value in the coming weeks.
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