Elon Musk tweets celebration of Tesla share rally
“Whoa ... the stock is so high lol”, Elon Musk tweeted as Tesla’s share price passed a symbolic threshold.
A Tesla rally has taken the stock above a symbolic threshold, the $US420 a share at which chief executive Elon Musk last year said he wanted to take the electric-vehicle maker private.
The new height of $US422.00, up more than 4 per cent in midday trading, also represents a U-turn in investor confidence after sentiment was shaken in the Silicon Valley automaker, with shares closing as low $US178.97 in the past year.
A surprising third-quarter profit, the unveiling of a new pick-up truck and progress toward building Model 3 compact cars in China have fuelled the stock’s rise. Tesla shares are up about 74 per cent from $US241.23 on September 23.
Whoa … the stock is so high lol
— Elon Musk (@elonmusk) December 23, 2019
The $US420 mark is a uniquely Tesla milestone. When Mr Musk in August 2018 wrote on Twitter that he wanted to take-private the electric automaker it spurred months of upheaval.
The price in 2018 represented a slightly greater than 20 per cent premium from where the stock closed in the days before he made the announcement. The effort to take the company private, though, quickly went up in smoke when it became clear that such a move was harder to pull off than first imagined.
The surprise announcement -- at a time Tesla was struggling to build its mass market Model 3 model -- sent Tesla shares soaring, only to crash later when investors realised Mr Musk hadn’t completed the funding to pull off the manoeuvre. It spurred an investigation by the Securities and Exchange Commission that alleged Mr Musk misled investors with his tweets.
The SEC and Mr Musk later settled the case. The Tesla CEO paid $US20 million to settle that case, stepped down as chairman and agreed to have his material statements overseen by Tesla.
The government revealed that Mr Musk rounded up the offering price to the $US420 price from $US419 to amuse his girlfriend because the number is part of marijuana culture. Mr Musk further cemented his reputation in drug culture in September of last year when he appeared during a live-video interview puffing a marijuana joint.
In the months that followed, Mr Musk and Tesla faced continued challenges in building and delivering the Model 3, the company’s bet that it can evolve from a niche luxury player into a car company offering electric vehicles to mainstream buyers.
Mr Musk, a prolific tweeter, also later ran into more trouble with the SEC when he made statement the regulator felt violated their earlier settlement. The two sides settled this year.
Since going public in 2010, Tesla has been among the most shorted stocks, with some investors gambling the company is overvalued.
For Mr Musk, reaching $US420-a-share “is about the most significant milestone for his investor credibility in the last several years,” said Gene Munster, managing partner at investment and research firm Loup Ventures. “It shows that his intuition, whether you view it as comical or not, his intuition is right.”
As the stock surged, Mr Musk weighed in on Twitter, “Whoa ... the stock is so high lol.”
Wall Street Journal
Firms looking to chop costs with wage cuts, lay-offs
Some 20,000 financial services and telecommunications roles have been shifted overseas as local contractors are given the flick and employers begin to cut costs.
Nobel winner issues AI alert
After receiving the Nobel Prize in Physics, British-Canadian AI pioneer Brian Hinton, who shared the prize with John Hopfield, warned that the technology he helped create could lead to the subjugation of humanity.