Tesla shares rise as Musk sells $5bn worth of stock after Twitter poll

·3 min read

Tesla’s (TSLA) shares were up in Europe on Thursday morning even as it was revealed that CEO Elon Musk offloaded roughly $5bn (£3.5bn) of its stock in recent days.

This comes after what some are calling a "bizarre" poll on Twitter on 6 November, in which Musk asked if people support his proposal to sell 10% of his stock in the electric car maker, which comprises most of his estimated $281bn fortune.

More than 3.5 million people voted, with about 58% saying "yes".

Filings show Musk ended up selling about 3% over the weekend — his trust sold around 3.6 million shares in Tesla, worth $4bn. 

Read more: Tesla's $1tn valuation consolidates Elon Musk as world's richest man

He is also selling a separate block of Tesla shares via a plan that he set in motion in September. Those sales amount to more than 930,000 shares worth over $1.1bn.

Tesla's shares in Frankfurt (TL0.F) were up 4.4% at the time of writing, recouping some of the heavy losses suffered earlier in the week.

In the US they were up 2.7% in pre-market trading.

Investors appear to be downplaying the significance of Musk's move for the stock's outlook, focussing instead on strong car orders.

The company delivered 241,300 electric vehicles and produced 237,823 vehicles in the third quarter of the year. It also reported $1.62bn in net income for the quarter, up from $331m a year ago.

Tesla is now up more than 51% in 2021, thanks in part to a rally last month after it made a deal to sell 100,000 vehicles to rental car company Hertz..

Musk is known for his controversial tweets. He made it clear that he would "abide by the results of this poll, whichever way it goes", adding that "I do not take a cash salary or bonus from anywhere. I only have stock, thus the only way for me to pay taxes personally is to sell stock."

Tesla's stock was up on Thursday morning in Frankfurt. Chart: Yahoo Finance UK
Tesla's stock was up on Thursday morning in Frankfurt. Chart: Yahoo Finance UK

A day before the tweet, it was reported that Tesla's market capitalisation is greater than all 21 energy companies in the S&P 500. The company's share price has made staggering gains over recent years.

"Valuations don't get much richer than that. So, no matter what the reason, Musk is making the trade of his life," said Mati Greenspan, founder of Quantum Economics, in reaction to the poll, adding that Musk "is really begging the question... Is paying taxes an altruistic notion?

"There's an old saying in the venture capital world that people shouldn't bet against Musk, but in this case, he is clearly betting against himself, and possibly the rest of the market as well."

Watch: What are negative interest rates

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting