Billionaire Entrepreneur Elon Musk Purchases Over a Billion Dollars Worth of Tesla Shares, First Acquisition Since 2020
Tesla Shares Surge as Elon Musk Makes Major Investment
In a move that has sent shockwaves through the tech industry, Elon Musk, the CEO of Tesla, has purchased 2.55 million shares of the electric vehicle company, amounting to approximately $1 billion. This is Musk's first Tesla stock purchase on the open market in over five years.
The purchase, made on September 12, 2021, through the Elon Musk Revocable Trust, has been interpreted as a major vote of confidence in Tesla's future. According to William Blair's Jed Dorsheimer, the purchase indicates strong confidence in Tesla's most important future business.
Musk's indirect holdings in Tesla now exceed 413 million shares, with him also directly owning 96 million shares. His recent purchase increased his stake in Tesla by 0.62%.
The weighted average price per share for the purchase ranged between $371.90 and $396.36. This purchase comes at a crucial time for Tesla, as the company's stock had been sliding in recent months due to Musk's public feud with President Donald Trump. However, the news of Musk's investment has caused Tesla stock to surge more than 6%, reaching around $420 per share.
The purchase was not part of a 10b5-1 trading plan, indicating that Musk made the decision to buy on the open market. This move seems designed to reassure investors and send a message that Musk is all-in on Tesla's long-term growth.
The surge was not the only positive development for Tesla. The company's board recently proposed a $1 trillion compensation package for Musk, tied directly to market value milestones. The proposed compensation package for Musk is unprecedented in its size.
Musk's recent purchase and the proposed compensation package are set for a shareholder vote in November. The compensation package depends heavily on Tesla's future stock performance, adding another layer of significance to Musk's recent investment.
Jed Dorsheimer sees Musk's buy as a positive sign, coupled with momentum around deliveries and Tesla's Robotaxi rollout. The positive sentiment around Tesla is likely to continue, as investors and analysts alike watch with bated breath to see how these developments will unfold in the coming months.
