TSLA stock offering

TSLA stock offering

Do TSLA bulls feel betrayed?

Only two weeks ago, Elon said:

"We're actually spending money as quickly as we can spend it sensibly."

"There is no artificial holdback on expenditures. Anything that I see that ... looks like it's got good value for money, the answer is yes, immediately. And then despite all that, we are still generating positive cash. So in light of that, it doesn't make sense to raise money."

andy.connor.e | February 13, 2020

Probably an opportunity arose that they did not anticipate.

tew ms us | February 13, 2020

I didn't like it, but, based on a market cap of 138B, current stock holders are looking at about a 1.5% dilution.

PECo CT | February 13, 2020

It’s hard to fault the company for taking advantage of the spike in the stock price.

PrescottRichard | February 13, 2020

Yet another fish hook.

SamO | February 13, 2020

TSLA share price on January 29,2020 the date of the question was $580. Today, $800.

Maybe someone can tell me the difference?


Xerogas | February 13, 2020

I love that they’re accelerating worldwide buildouts of factories, which is extremely capital intensive, without borrowing money from lenders.

andy.connor.e | February 13, 2020

That was one of the things touched on in the earnings call. Everything that they're doing like building the china factory, and still managed to turn a profit. Imagine if they were not building the factory how much they would have profited.

dmm1240 | February 13, 2020

@SamO. Sure. The disruption is underway. EV sales across Europe are now coming in at better than 5%. If you read Tony Seba's books on how disruptions work, this one is proceeding according to the norm. Analogue analysts always predict a gradual shift from an old technology to a new one. That is what they do. It never happens like that. Disruptions go quickly taking 12-13 years on average. What is happening now is EV sales have started up the hockey stick. Seba predicts that the tipping point will come in 2022. What that means is purchase costs will be low enough to attract more mainstream buyers. From there, sales will explode. The Osborne Effect will occur soon meaning the market for new and used ICE cars will plummet.

Of all the companies out there, and some of the legacy companies are coming to their senses, Tesla is best positioned to take advantage of the EV revolution the company kicked off. It is vertically integrated giving it more control of its product from seats to wheels to the computer that is the heart of it where legacy companies don't. Tesla makes its own batteries where legacy companies are dependent on LG, etc for theirs. Problems galore. Audi just had to suspend production of the iPace because it can't get batteries. Tesla planned for this. IMO, battery day in Buffalo in April will have jaws dropping. Tesla has something big up its sleeve. The rest of the world is catching on to what Tesla has going on and that is propelling the stock price upward. There will be dips, the roller coaster will not stop, but the future for Tesla looks increasingly bright.

OTOH, there are forces at work that bode ill for the world economy as a whole. There is a bubble in corporate debt, consumer debt and the stock market. That bubble will burst. Nobody knows when. IMO, Tesla will emerge a winner but there is a big storm on the horizon. Met with my financial planner today and he agrees.

Earl and Nagin ... | February 13, 2020

Tesla has issued more stock with every huge stock spike driven by a short squeeze. Why would anyone think they would be dumb enough to pass on another opportunity to raise some more cheap capital.
Go Tesla!

tew ms us | February 14, 2020

Today's numbers show a little less than a 1.7% dilution. Market action so far today indicates nobody seems to care.

andy.connor.e | February 14, 2020

The only people who care are all the media companies who post articles to hopefully make people care about something that doesnt matter. AKA shorts.

andy.connor.e | February 14, 2020

This is so fitting! | February 14, 2020

Like the Model Y, when reservations came in far faster than they expected, they moved up production 10 months or so - an incredible speedup that's unheard of in the auto industry. I expect the same for the Cybertruck. Build another new plant in the US, and speed the EU factory, that requires a lot of capital, but the payback is fast. And continuing to be first to market with a desirable product in every class has huge long-term benefits. Even if there is a slowdown, Tesla might reduce its growth from 50%/year to 25%/year. Legacy automakers are declining in these current great times - they are going to be hit very hard if auto sales slow, and some are not going to make it. Tesla is not going to be one of them.

Ross1 | February 14, 2020

There is a chance "someone" could buy Renault for their real estate/ factories. Worth about 10 billion as a going concern.
Then a lot more "Nummis' will shortly be being given away.

jordanrichard | February 14, 2020

First they need to build/open the factory in Germany.

vermaruby38 | February 16, 2020

"We're actually spending money as quickly as we can spend it sensibly."

Ross1 | February 17, 2020

And the Legacies are spending it as quickly as they have to idiotically.

David N | February 17, 2020

“TSLA stock offering
Submitted by PECo CT on February 13, 2020
Do TSLA bulls feel betrayed“

Not at all. It’s much easier and prudent to do now, even if they do not need it at the present time.
Waiting could come in an economic slow down.
It was a strategic move that will bode well for Elon,Tesla, and all shareholders. Shorts might be a bit upset, there won’t be much bad news anymore on the shortage of cash anymore.

tew ms us | February 20, 2020

The Deal is Done
4:55 PM ET 2/19/20 | MarketWatch
Tesla Inc. (TSLA) netted $2.31 billion in its recent stock offering, the company said in a filing late Wednesday. The company sold 2.65 million shares and the deal's underwriters exercised in full the option to buy another 397,500 shares, Tesla said

andy.connor.e | February 20, 2020

probably why it went up so much and why its down today.

tew ms us | February 28, 2020

That $2.31B capital raise should come in handy these days.