Why Tesla Stock Is Trading Lower Today
What happened
(NASDAQ: TSLA) are trading lower today, down 3.5% as of 1 p.m. EDT, after the electric-vehicle maker said that it plans to raise $5 billion by issuing new stock.
So what
sell up to $5 billion in stock. It’s an "at-the-market" offering, meaning that the shares will be sold over time at prevailing market prices, rather than in one big batch at a set price. ” data-reactid=”19″>In a series of regulatory filings on Tuesday morning, Tesla said that it has entered into agreements with several investment banks to sell up to $5 billion in stock. It’s an “at-the-market” offering, meaning that the shares will be sold over time at prevailing market prices, rather than in one big batch at a set price.
Image source: The Motley Fool.
Tesla does have some expensive projects in the works, including a factory under construction in Germany and a plan to build another in Texas. And it never hurts to bolster the balance sheet, particularly in uncertain economic times. (That might in fact be the company’s goal here.)
But it doesn’t appear to be in urgent need of cash: As of June 30, it had about $8.6 billion in cash on hand versus about $7.8 billion in long-term debt, excluding debt related to its leasing programs.
Now what
auto investors holding Tesla stock. But it’s possible that Tesla’s investors and fans were disappointed by the lack of a grand plan for the money, and perhaps that’s why shares were down today.” data-reactid=”37″>On balance, that seems modestly bullish for auto investors holding Tesla stock. But it’s possible that Tesla’s investors and fans were disappointed by the lack of a grand plan for the money, and perhaps that’s why shares were down today.
John Rosevear has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.” data-reactid=”46″>John Rosevear has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.
Why Tesla Stock Is Trading Lower Today was originally published by The Motley Fool” data-reactid=”47″>Why Tesla Stock Is Trading Lower Today was originally published by The Motley Fool
