Tesla stock had its worst week since March 2020 amid wild week for Musk

Elon Musk

Mike Blake | Reuters

Tesla shares fell nearly 16% during what CEO Elon Musk called “7 very intense days” to one of his 108 million Twitter followers.

Tesla shares closed at $265.25 on Friday, September 30. At the market close a week later, Tesla shares were trading at $223.07, down nearly 16%. It was the worst week for stocks since March 2020, when the Covid-19 pandemic began to affect the US, shutting down businesses and public life.

Over the weekend, Tesla reported production and delivery numbers for electric vehicles that fell short of analysts’ expectations.

On Monday, Musk caused a political firestorm by opining on how he thought the brutal Russian invasion of Ukraine should be resolved.

After that, public records revealed that Musk had informed the Delaware Court of Chancery that he would complete a $44 billion acquisition. Twitter in October, a deal he had been trying to avoid for months.

Tesla deliveries and AI Day

Analysts had expected Tesla to report deliveries of 364,660 cars in the period ending Sept. 30, 2022, according to estimates compiled by FactSet-owned Street Account.

But last weekend, Tesla reported total deliveries of 343,000 and production of 365,000 electric cars, despite starting production at two new factories in Brandenburg, Germany, and Austin, Texas.

Analysts wondered whether Tesla now faces eroding demand in China, where it faces stiffer competition from Warren Buffet-backed electric vehicle and lithium-ion battery maker BYD .

Tesla made one too engineering recruiting event on Friday afternoon last week where he presented an early and rough prototype of a humanoid robot and discussed the remaining challenges and progress in developing self-driving technology that can turn its robotaxis cars with a software update.

The robot’s demonstration failed to impress industry insiders, but its potential captivated some optimistic fans and analysts.

Musk in Russia

On Monday, Musk posted a Twitter poll to gauge support for what he claimed was a likely outcome of the seven-month conflict between Russia and Ukraine.

He suggested new UN-supervised votes in Ukraine on whether certain divisions of the beleaguered democratic nation should join Russia. He also suggested that Ukraine should cede Crimea to Russia and that the nation should remain “neutral” instead of aligning with NATO or Russia.

Musk was praised by the Kremlin but drew harsh criticism from many others, including Ukrainian President Zelenskyy, Ukrainian Ambassador to Germany Andrij Melnyk, South Carolina Sen. Lindsay Graham and anti-Putin human rights activist and former chess champion Garry Kasparov.

Kasparov, who tried to block Putin’s rise to power and was jailed and beaten for his activism before fleeing the country, described Musk’s plan as a “repetition of Kremlin propaganda.”

Turn the Twitter offer back on

Although Musk originally agreed to buy Twitter in April 2022, he spent months after that accusing the company of lying about its user metrics in financial filings while fighting in court to get out of the deal that he proposed

Twitter had sued Musk to ensure the deal would go ahead as promised, seeing a windfall for its shareholders. Ahead of a plea this week, and with a trial start date looming, Musk sent a letter to Twitter and the court this week saying he would take the company private after all at $54.20 per action He wanted Twitter, or the court, to stay the litigation, and a judge gave him an end October 28 to close the deal or go to trial.

The Tesla and SpaceX CEO may have to sell another chunk of his Tesla stock to finance the Twitter acquisition. It will only be able to do so on or after October 19, when the electric vehicle maker reports its third-quarter earnings.

On the way up…

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