Elon Musk, the CEO of Tesla, disclosed an additional $3.6 billion in stock sales on Wednesday, bringing his year-to-date total to close to $40 billion and angering investors as the company’s shares slump to two-year lows.
According to a securities filing, he sold 22 million shares of the most valuable automaker in the world over the course of three days, from Monday to Wednesday.
Despite his repeated assurances in April that he was finished selling Tesla shares, the sale is the second significant portion of stock he has sold since his $44 billion purchase of Twitter in October.
Although it is unclear whether the sales are connected to the Twitter purchase, they are upsetting investors who believe he is prioritizing Twitter over Tesla in terms of focus and resources.
Tesla is a well-liked stock among novice investors, according to Tony Sycamore, an analyst at brokerage IG Markets. “It doesn’t put a lot of confidence in the business, or speak volumes for where his attention is at,” he said.
“The situation is not ideal. Many of the investors I’ve spoken to who own Tesla stock are enraged with Elon.
An email sent to Musk and Tesla outside of regular business hours seeking comment received no response right away. Refinitiv data shows that Musk’s 13.4% ownership of Tesla is down from around 17% a year ago.
Over the past year, Musk has sold products worth a total of almost $40 billion.
Investors will begin to grow weary of it, according to Tareck Horchani, the Singapore-based Maybank Securities’ head of prime brokerage dealing.
The most recent share sale occurs a month after Musk sold $4 billion worth of shares in the days following the completion of the Twitter acquisition.
Strong Musk supporter Ross Gerber, a Tesla investor, tweeted that Tesla should make a buyback announcement “to take advantage of the low share price Elon has created.”
Musk briefly lost his title as the world’s richest person last week when Bernard Arnault, the head of Louis Vuitton, overtook him, according to Forbes. Musk’s fortune, which is largely based on Tesla stock, has declined with prices this year.
As a result of advertiser exodus and concerns over Musk’s method of monitoring tweets, Twitter’s revenue and capacity to make interest payments on the $13 billion debt that Musk assumed as part of the deal have both suffered.
Investors claim that his divisive tweets also pose a risk to the reputation and sales of Tesla automobiles.
RBC Capital Markets reduced its price target by $100 to $225 and stated that “investors are concerned about demand, pricing, auto-GMs (gross margins), and Twitter distraction/overhang/impact on Tesla brand.”
Additionally, macroeconomic challenges are affecting demand for Tesla’s pricey vehicles. To increase demand in its two largest markets, the United States and China, the company is providing discounts.
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