Tesla to sell up to $5 billion in stock amid rally


Amid Tesla’s record rise that has seen shares soar to new highs, the company said Tuesday that it will sell up to $5 billion in stock.

The additional shares will be sold “from time to time” and “at-the-market” prices, a filing with the Securities and Exchange Commission said. Banks will sell shares based on directives from Tesla.

The stock retreated from its premarket high following the news, but was still about 3% higher.

Tesla shares have been on fire this year. Through Monday’s close, the electric car maker has gained nearly 500% in 2020. In the last year, shares have gained 1,004% compared with the S&P 500’s 20% rise.

Tesla’s run-up has only gained steam since the company announced its 5-for-1 stock split on Aug. 11. In that time, Tesla shares have rallied 81.3%. That gain includes a 12.6% pop on Monday, when the split took effect. This is despite the fact that stock splits are purely cosmetic, meaning nothing about the company’s underlying business changes.

Tesla’s market cap now stands around $464 billion, according to FactSet.

The rate at which investors have piled into the Elon Musk-led company has left many on the Street puzzled. On Monday night RBC reiterated its underperform rating on the stock, calling the automaker “fundamentally overvalued.” That said, the firm did raise its price target from $170 to $290.

This is a developing story. Check back for updates.

– CNBC’s Fred Imbert contributed reporting.

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.



Source link

Discover

Sponsor

Latest

New Audi RS 3 sedan caught testing in new spy photos

The high-performance RS 3 variant of Audi's new A3 sedan and hatchback has been in development for some time, but now that the...

Ex-Pence aide slams Trump coronavirus response, says she’s voting for Biden

President Donald Trump and Vice President Mike Pence look on during the daily briefing on the novel coronavirus, COVID-19, in the Brady Briefing...

ByteDance, U.S. government talking about avoiding full sale of TikTok

TikTok logos are seen on smartphones in front of a displayed ByteDance logo in this illustration taken November 27, 2019.Dado Ruvic | ReutersByteDance...

Germany likely to stick with Nord Stream 2 despite Navalny poisoning

The Akademic Chersky pipe layer is seen in the Gulf of Gdansk in the Baltic Sea. According to Russia's energy minister Novak, Akademik...

Apple One bundle, long rumored, would cheer Wall Street

Apple CEO Tim Cook delivers the keynote address during the 2020 Apple Worldwide Developers Conference (WWDC) at Steve Jobs Theater in Cupertino, California.Brooks...