Cars and Drivers
Tesla Short Interest Rises 1.7 Million Shares
Published:
Last Updated:
Shares sold short in Tesla Motors Inc. (NASDAQ: TSLA) rose by 1.7 million to 27.9 million for the period that ended September 15. The number is a very high 25% of the float. These bets against the stock price are likely justified.
Tesla is losing a war on three fronts. The first is that the amount of competition from the world’s largest manufacturers in rising during a period when Tesla does not have its own manufacturing facilities that can pump out cars to keep up with demand. Its much anticipated Model 3, priced closer to a level many people can afford compared to Tesla’s earlier products, is not available. In the meantime, General Motors Co. (NYSE: GM) has launched its Chevy Bolt, which is considered a direct competitor. The electric car race is furious, to some extent because of Tesla’s early success.
Tesla is to takeover of Solar City Corp. (NASDAQ: SCTY), a company that many investors believe is overpriced based on its potential, and one that has only limited synergies with Tesla.
According to a Bloomberg report:
Elon Musk may have more work to do to convince his own shareholders to go along with the $2.6 billion proposed merger of Tesla Motors Inc. and SolarCity Corp.
Shares in both companies slumped after Musk — the largest individual shareholder in SolarCity — announced that Tesla had agreed to pay about $300 million less than initially proposed six weeks ago to acquire the rooftop solar installer. The revised terms come after criticism from Tesla investors and on the same day SolarCity lowered its forecast for 2016.
Musk, Tesla’s chairman, has said the combined company would become a clean-energy giant. He will have a couple of months to convince SolarCity shareholders to take the lower offer and will have to reassure Tesla investors that the company can afford to carry SolarCity while also coming up with billions of dollars to fund a slew of new vehicles.
Tesla’s shares are down 13% to $209 this year. It was once one of the hottest stocks traded on Nasdaq.
Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
