Elon Musk sells $5 billion in Tesla shares after Twitter poll

California, Nov. 11 (BUS): Tesla CEO Elon Musk has sold nearly $5 billion in stock, the billionaire said Wednesday, just days after polling Twitter users for a 10% stake sale.

In its first stock sale since 2016, Musk’s fund sold nearly 3.6 million Tesla shares, worth about $4 billion, while also selling another 934,000 shares for $1.1 billion after exercising options to acquire nearly 2.2 million shares, it said. Reuters.

4.5 million shares account for about 3% of his total holdings in the electric car maker, which makes up the bulk of his estimated $281.6 billion fortune, according to Forbes.

On Saturday, Musk polled Twitter users about selling his 10% stake, which helped bring down Tesla’s share price after a majority on Twitter said it approved the sale.

The stock plunged 12% Tuesday in a multi-day sell-off that put the company’s position in the trillion-dollar club at risk, but it rebounded 4.3% on Wednesday.

Options related sales in September were set up with a trading scheme that allows company insiders to conduct pre-planned transactions on a schedule, the filing said. Payments for stock sales related to options versus the taxes associated with them. It was not clear how or if the trading plan was linked to Musk’s Twitter poll. Tesla did not respond to a request for comment.

Additional stock sales were separate and provide Musk with ample cash reserves, since his wealth is largely tied to his stakes in Tesla and SpaceX.

Musk has more than 20 million additional stock options that are due to expire in August of next year.

If Musk implements his 10% share sale plan, it will be a slight negative in the near term, said Mark Arnold, chief investment officer at Hyperion Asset Management in Brisbane, where Tesla ranks first in its global fund.

“But the stock is well liquid and not a large percentage of the total issued shares, so it shouldn’t have that big of an impact… We are quite comfortable with the business outlook,” he said.

While Tesla lost nearly $150 billion in market value this week, retail investors were net buyers of the stock. About 58% of Tesla’s trading orders on Fidelity’s brokerage site Wednesday were for purchases, not sales.

Retail investors made net purchases of $157 million on Monday and Tuesday, according to Vanda research.

Tesla is now up more than 51% in 2021, thanks in large part to an October rally fueled by an agreement to sell 100,000 cars to car rental company Hertz.

“The company itself is on fire, with solid results,” said Tim Greskey, senior portfolio analyst at New York-based investment management firm Engels & Snyder.

Bullish sentiment returned to Tesla options on Wednesday, with around 1.1 calls per trade trading. Calls are usually used in bullish trades, while buying shows a bearish bias.

The company’s options have taken in about $109 billion in premium-changing contracts over the past two weeks, or about one in every three dollars traded in the US-listed options market, according to a Reuters analysis of trade alert data.

MI