Oops He Did it Again: How One Tweet from Elon Musk Led Tesla to Lose Billions
Now that the economy is in a very fragile state, you’d think that the executives of the world’s largest corporations would be treading things much more lightly to ensure the survival of their business.
Not Elon Musk, though. The high-profile Tesla CEO seems to have no problem being vocal about what he thinks is wrong with his company, more particularly the price of its stock.
Unfortunately, it looks like a lot of people didn’t agree with his opinions, and they also didn’t have problems making what they think known.
Like he’s always done in the past, the 48-year-old billionaire went to Twitter to let the public know what’s on his mind. In early May, Musk sent out a short yet clear message: Tesla’s stock price is too expensive, he thinks. The automaker was trading at $760 per share before his statement.
It soon plummeted to just below $700 as investors reportedly pulled out of Tesla after the CEO’s declaration. However, their decision might have also been affected by the series of tweets Musk posted before talking about getting rid of his physical possessions.
Ask, and you shall receive indeed. In total, the seven-word tweet is estimated to have wiped out $14 billion off of Tesla’s value and $3 billion of Musk’s stakes in the company.
Not the First Time
For longtime fans or active observers of the businessman, his new may not seem that extreme. After all, this is the same man who’s made comments like Tesla’s stock is worth more than it deserves at a 2013 company event.
His latest tweet might have affected his potential payday though more than anything. Musk is bound to get a significant part of his stock pay should he succeed in keeping Tesla’s market value above $100 billion for half a year.
Continuing to make statements that wick off billions of its market cap is certainly not a wise move on his part.
Luckily, Musk won’t likely face severe consequences for his tweets because they only reflect his personal opinions, according to corporate law professor John Coffee.
Still, you’d think the innovator would have learned to keep his tweets casual after already getting in trouble for them before.
He previously went head to head with the U.S. Securities and Exchange Commission (SEC) for a 2018 tweet that purported the securing of funding to make the company private at $420 a share.
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