Elon Musk sells $ 3.95 billion worth of Tesla stock

The world’s richest man, between 4 and 8 November, sold $3.95 billion worth of Tesla shares. 

Musk sells Tesla shares to boost liquidity

On 28 October, Elon Musk finally succeeded in the feat of buying Twitter after a thousand vicissitudes at a price of $44 billion thanks to a “string” of investors in which he of course was the big voice. 

Just as he has done in the past with each investment, the entrepreneur is accustomed to cash out and sell part of the huge number of shares he owns. 

The market had expected this move on the part of the naturalized Canadian entrepreneur but the point is that the market did not expect the sale to have been so significant in terms of numbers.

Indeed, in the first days of November at a price of between $203.6 and $219.9, Musk sold 19.5 million Tesla shares of the 455 million shares of the EV maker that he owned. 

The equivalent value of the shares sold is $3.95 billion, according to the US Securities and Exchange Commission. 

Musk is cashing out to get back from the huge investment and bring back sufficient liquidity to cope with the market, its risks and future challenges, but in the deal, Twitter was not alone. 

In fact, the acquisition of the most widely followed social network in politics, management and finance was made possible by a plethora of investors including Binance for $500 million on CZ’s own admission, Andreessen Horowitz and Prince Alwaleed bin Talal bin Abdulaziz of Saudi Arabia.

Gary Black, the managing partner of Future Fund, had been far-sighted and even before the acquisition predicted that Musk would recover from the investment and that the sale of the shares in order to raise cash would take place with the price still above $200, as in fact it did. 

The shares’ performance on the stock market

In the first week of November (practically since the founder of Tesla has been at the helm of Twitter) Tesla’s shares suffered a 16% thud of their value and in the last run of trading they lost almost another 3% (2.93%) trading below the psychological threshold of $200 at $191.3. 

During trading on 8 November, the stock touched $186.75 per share marking a negative record in recent weeks and triggering concern in the market. 

The idea that is gaining momentum is that Elon Musk is getting too distracted by the blue bird social by neglecting what is his golden goose which is Tesla.

The entrepreneur’s obsession with the purchased social is an important component, as explained by him, for the future, since it serves as a sounding board for Tesla’s thinking and in addition will be very profitable in the long run, which is why at this stage he had to focus on changing certain things as quickly as possible. 

The layoffs and the introduction of certain changes such as paid blue ticks verge precisely on getting the finances in order and making the social more profitable. 

Investors’ concern stems not only from the famous engineer’s apparent loss of focus on Tesla but also from the US midterm elections that could sanction a Republican victory in both chambers thus complicating the green turn that the Texas-based company also benefits from in terms of US government investment. 

Jim Cramer said Tuesday during CNBC’s “Mad Money Lightning Round” that Tesla has managed to win an Oscar, the one for verbatim: 

“the worst graph I’ve ever seen, and that’s what’s driving things.”

Although the chart is worrying, given the historical phase in which we live, the prudent sale of Bitcoin in the past quarters to cope with the uncertainties of the future etc. it is only a matter of time, the stock of the electric car par excellence will soon be back above $200. 

New production and assets of Elon Musk

Supporting this hypothesis is the data on reservation orders for the company’s latest car, namely the Model Y. 

Particularly in Asia and Europe, orders for Tesla’s little one have been almost double what was expected giving a good deal of confidence for the future. 

In the last year, and not only as a result of the Twitter operation, Musk has seen his personal wealth halve (-48%) from $340 billion to $177 billion, a figure that although smaller is enough to keep him in first place in the special ranking of the richest men in the world. 

The billions lost for the entrepreneur appear to be an investment by his own admission, a temporary phase then that will bring his finances well above the trillion mark again.