Technology

Tesla stock had its worst week in 20 months after Musk sold stock

tesla-stock-had-its-worst-week-in-20-months-after-musk-sold-stock

SpaceX owner and Tesla CEO Elon Musk gestures during a conversation at the E3 gaming convention in Los Angeles on June 13, 2019.

Mike Blake | Reuters

Tesla shares were down 15.4% for the week after CEO Elon Musk began his plans to sell a large portion of his holdings this week.

It marks Tesla’s worst one-week performance in 20 months. It’s also the stock’s worst week ever, excluding the falls in February and March 2020 – when the coronavirus pandemic hit the US and churned the markets.

Tesla closed 2.8% on Friday.

Musk – who still owns more than 167 million Tesla shares according to financial records Friday morning – sold roughly $ 5.7 billion in shares this week.

Musk partially sold shares to meet tax obligations related to the exercise of stock options. Before his sales plan was released, Musk asked his 62.5 million Twitter followers to vote in an informal poll, letting them know that their vote would determine the future of his Tesla inventory. This week’s records show he knew that some of his shares were up for sale this week.

Tesla stock is still up around 46% since the beginning of the year after a record closing price of USD 1,229.91 on November 4, 2021.

For comparison: Ford shares are up around 120%, General Motors shares are up around 51% and Volkswagen AG shares are up around 66% over the year to date.

The slump in Tesla’s stock price followed a sell-off and coincided with a record-breaking auto listing for Rivian, a newer maker of all-electric pickups and sport utility vehicles.

Rivian’s shares rose 5.6% on Friday. It’s up around 66.6% since its debut on Wednesday.

Rivian raised roughly $ 12 billion on its market debut on Wednesday, making its IPO the largest in the world so far this year. Rivian is now the second most valuable automaker in the U.S. after Tesla, but expects third-quarter revenue to be less than $ 1 million.

In financial records, Rivian said it has 55,400 pre-orders for its R1S SUV and R1T pickup truck, as well as a contract to build 100,000 electric vans for Amazon by 2030.

Musk responded to Rivian’s IPO success on Twitter by saying:

“I hope they can get high production and balanced cash flow. That is the real test. There have been hundreds of automotive startups, both electric and internal combustion, but Tesla is the only American automaker to have high output and positive cash flow “for the past 100 years.”

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