Shares of the largest electric car maker Tesla, Inc. (TSLA) gained 7.5% on Wednesday, after its CEO Elon Musk said he has sold “enough stock” to reach his 10% sale of Tesla’s stake. The company regained its $1 trillion market cap status, with shares closing at $1,008.87 on December 22.
The upswing in Tesla stock and a few of the big tech stocks also pushed the S&P 500 (SPX) up 1% on Wednesday.
Musk Says He Sold Enough Stock
Since Musk’s infamous Twitter, Inc. (TWTR) poll on November 6, Tesla stock has lost around 17% of its value. With Musk selling his proposed 10% stake in the company in a phased manner, investors have joined the bandwagon and gone on a selling spree.
However, investors found relief in Musk’s recent interview, where he said, “I sold enough stock to get to around 10% plus the option exercise stuff, and I tried to be extremely literal here.”
The words echoed that the CEO will be halting his stock sale, although he hasn’t yet reached the full 10% stake. The day after the interview, Musk sold another 340,564 shares for $333.6 million, as disclosed in a Form 4 filing with the SEC.
Apart from the comments on the share sale, Musk also shed some light on his decision to move out of California. The CEO said, “California used to be the land of opportunity, and now it is… becoming more so the land of sort of overregulation, overlitigation, over taxation.”
Wall Street View
Yesterday, RBC Capital analyst Joseph Spak reiterated a Hold rating on the stock with a price target of $950, implying 5.8% downside potential to current levels. Spak estimates Tesla will deliver 285,000 vehicles in its upcoming earnings for the fourth quarter.
The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 13 Buys, 8 Holds, and 5 Sells. The average Tesla price target of $1,004.33 implies that shares are almost fully valued at current levels. Shares have gained 56.2% over the past year.
Insider Trading Activity
TipRanks’ Insider Trading Activity shows that Insider Signal is currently Negative on Tesla, with corporate insiders selling Tesla shares worth $5.9 billion in the last quarter.