Tesla Stock Higher As Elon Musk Reveals $3.95 Billion Share Sale After Twitter Deal Closing

Tesla CEO Elon Musk has sold around $20 billion in Tesla shares so far this year, including nearly $4 billion when the stock was trading near 52-week lows.

Tesla  (TSLA) – Get Free Report shares inched modestly higher Wednesday after Securities & Exchange Commission filings showed CEO Elon Musk has sold another $3.95 billion in company stock as he continues to find cash for his recent acquisition of Twitter.

Musk, who is also financing part of the $44 billion required to buy the social media website, sold 19.5 million shares between November 4 and November 7, at prices ranging between $197.196 and $208.731 per share, across a total of twelve transactions.

Earlier this summer, Musk sold 7.92 million shares between August 5 and August 9, netting a total of around $6.9 billion, taking advantage of a 47% rally in Tesla shares from late May to August 5, when the first sale was made. He sold another $8.5 billion in April.

Musk told Tesla investors last month that he and his investor group were “obviously overpaying” for the social media group, with overall costs pegged at $46.5 billion. 

Musk himself was on the hook for around $33.5 billion, a tally that included his 9.6% Twitter stake and $7.1 billion in equity commitments from outside investors. He has also arranged for debt financing of around $13 billion. 

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Tesla shares, which have lost around 50% of their value since Musk made his Twitter ambitions public in early April, were marked 0.73% higher in pre-market trading to indicate an opening bell price of $192.70 each.

Musk’s sales aren’t the only headwind Tesla is facing, however, and data from China earlier this week suggests demand concerns in the world’s largest car market — and key Tesla manufacturing hub — linked in part to the country’s ‘zero Covid’ health policies.

Tesla sold 71,704 cars in China last month, an industry group said Monday, including around 54,505 for export, down from record sales of just over 83,000 in September. 

Last month, Tesla, which has been raising costs of its U.S.-made cars for much of the year, reduced the starter price of its Model 3 sedan by around 5.3%, and cut the cost of its Model Y by 9%, just days after its third quarter earnings reported echoed the impact of rising production costs and indicating narrowing profit margins for the world’s most-valuable car company.

Gross automotive margins were 27.9%, a 600 basis point decline from last year, Tesla said, and flat to the figure recorded over the second quarter, owing to put a surge in input costs and expenses linked to the ramp-up of new factories in Austin and Berlin.

The group also said full-year deliveries may fall just shy of its 50% growth target as it “simplifies operations, reduce costs, and improve the experience of our customers.”

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