Wall Street Gobbles Up Tesla Securities
Pure power
Published on May 4, 2019 |
by Steve Hanley
4. May 2019 av Steve Hanley
After the last Tesla earnings call, some stock analysts and short sellers began to sing from "Isn't that terrible" songbook. "We were right all the time. Tesla is on the verge of bankruptcy. Tesla and Elon Musk will finally get the appearance they deserve so abundantly!" That's how the now known refrain goes. When Tesla said it could raise up to $ 2 billion in new money, the screams of doom and silly reached a crescendo of near hysteria.
Back in the real world, where real investors make decisions based on real facts and not emotions, things went swimming last week. Tesla offered a mix of stocks and convertible notes and Wall Street gobbled them up and asked for more. According to ArsTechnica, it sold $ 737 million shares and another $ 1.6 billion worth of convertible notes worth a total of $ 2.34 billion. Underwriters will have the opportunity to buy another $ 350 million in stock and debt over the next month.
In another sign that the investment community is generally not too concerned about Tesla's viability, the Tesla share increased 4% on Thursday and another 4.5% on Friday after the capital acquisition. Typically, when a company sells more shares of shares, the price goes down as it is now a larger sector for all investors to share.
The convertible notes give lenders the opportunity to share in the company instead of cash when the loan matures in May 2024. The new convertible notes come at a price of $ 309.83, which is 27% above the official sales price of $ 243 and have a modest 2% interest rate. The latest convertible notes the company sold in 2017 came with an interest rate of 2.375%.
When selling new shares and convertible notes that have been completed, Tesla has almost NOK 4 billion in cash, money that it can use to move on. It is the plan to get model Y and Tesla Semi to production. "The vanguard of Wall Street can also give Tesla a different breath," ArsTechnica .
"In the past year, some critics warned that Tesla became such a basket so that it can be required to raise money at all and be forced into bankruptcy. This week's strong fund raises the issue that this task was wrong "Tesla may or may not eventually become the big and profitable car company Elon Musk is trying to create. But if Tesla falls short, it won't be because of short-term cash flow issues."
Whew! Now that Tesla has avoided bank wuptcy once again, it's time to come back to the important work of declining the world of fossil fuels. There is no time to lose.
Tags: Bankwuptcy, Elon Musk, Tesla, Tesla convertible notes, Tesla finance, Tesla stock
About the author
Steve Hanley Steve writes about the technology-sustainability interface from his home in Rhode Island and where Anyway else, Singularity can lead him. His motto is, "Life is not measured by how many breathing we take, but by the number of moments that take our breath away!" You can follow him on Google + and on Twitter .
