Cars and Drivers
Do Investors Want More Tesla Shares at Any Price?
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Tesla does not ever seem to have had that problem. Since coming public in late June of 2010, the company raised capital several times:
In all prior sales, the company’s founder and CEO, Elon Musk, acquired more shares, taking 1.5 million shares in 2011 (about $43 million worth), $1 million worth in the 2012 sale and $100 million worth in the third. Musk has indicated that he will acquire a further $20 million worth in the sale announced Thursday morning.
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That Musk is willing to load up on shares in secondary sales is a plus, but it is not the main reason for the share price gain whenever Tesla issues new shares. Put simply, demand for the stock is stronger than demand for the vehicles. For one thing, since its IPO at $17 a share, the shares have appreciated by about 1,200%.
Depending on what an investor believes, that share price increase proves either that there’s a sucker born every minute or that Tesla is the growth stock of the 21st century. You pays your money and you takes your chances.
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