Why Tesla Should Go Private
Tesla, Elon Musk's automotive and energy company founded in 2003, is one of the biggest companies in the current day and age, with a revenue of over $21 billion in 2018. This public company specializes in electric car and solar panel manufacturing and is one of the most controversial stocks in the market right now.
Back in August 2018, Tesla's CEO and founder Musk tweeted about Teslagoing private at $420 per stock. From then on, shareholders could sell the stock(s) and generate a profit. Since then, Musk has been accused of fraud and misleading the public and his shareholders, as he remained public.
In an article by the CCN by Ben Brown, called Elon Musk is 100% Right. 3 Reasons Tesla Must Go Private... Or it's Doomed, Brown listed reasons why Tesla should have followed up with the going-private plans, and how Musk has made a mistake in doing so. More so, the article discussed the vast reasons how Tesla is losing millions of dollars in revenue, such as one Wednesday, where Tesla reported a $702 million loss.
Tesla’s stock prices
Data bySentio
Tesla's incompetence in going private has caused massive issues for the company, whose stock is now staggering at a -7.5%. This topic specifically concerns the 6th business concept: strategy.Tesla's strategy is to rather focus on the short-run (quarterly) rather than looking at a larger span of time (5 years) which is one of the drivers towards its downfall in the stock market.
Another reason for Tesla's downfall includes the company being extremely shortstocked . According to the market data supplier S3, Tesla has the least amount of stocks in the market in 2019.
So why has Tesla all this time stayed public? Musk has claimed in 2018, that investors have “begged him to stay public.” After Musk’’s tweet, he claimed that “Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company.”
In an article by Vince Martin for the InvestorPlace, he claims that Tesla has the potential to reach thousands of dollars per share, which it could by firstly, dominating the ultra-competitive automotive sector.
The big question is: What should Tesla do?
Going private, as the most suggested advice would benefit Tesla majorly. Companies usually go private when they tend to have more predictable and stable trends, as Ben Brown says, which is definitely not the case with Tesla. Other reasons why Tesla should go private is that it will introduce Tesla once again as a luxurious and high-end brand, while also giving Musk the stability and more freedom to experiment without the company’s finances being out in the public and desperate to meet expectations, and pursuing a more long-term vision rather than trying to survive on a quarterly basis.
Sources Used:
https://investorplace.com/2019/03/problem-tesla-stock-remains-management/
https://www.ccn.com/elon-musk-is-100-right-tesla-doomed-private/
https://www.businessinsider.nl/tesla-going-private-makes-sense-heres-why-2018-8?international=true&r=US
https://www.theatlas.com/charts/H1KNB-DhV
Back in August 2018, Tesla's CEO and founder Musk tweeted about Tesla
In an article by the CCN by Ben Brown, called Elon Musk is 100% Right. 3 Reasons Tesla Must Go Private
Tesla’s stock prices
Data by
Tesla's incompetence in going private has caused massive issues for the company, whose stock is now staggering at a -7.5%. This topic specifically concerns the 6th business concept: strategy.
Another reason for Tesla's downfall includes the company being extremely short
So why has Tesla all this time stayed public? Musk has claimed in 2018, that investors have “begged him to stay public.” After Musk’’s tweet, he claimed that “Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company.”
In an article by Vince Martin for the InvestorPlace, he claims that Tesla has the potential to reach thousands of dollars per share, which it could by firstly, dominating the ultra-competitive automotive sector.
The big question is: What should Tesla do?
Going private, as the most suggested advice would benefit Tesla majorly. Companies usually go private when they tend to have more predictable and stable trends, as Ben Brown says, which is definitely not the case with Tesla. Other reasons why Tesla should go private is that it will introduce Tesla once again as a luxurious and high-end brand, while also giving Musk the stability and more freedom to experiment without the company’s finances being out in the public and desperate to meet expectations, and pursuing a more long-term vision rather than trying to survive on a quarterly basis.
Sources Used:
https://investorplace.com/2019/03/problem-tesla-stock-remains-management/
https://www.ccn.com/elon-musk-is-100-right-tesla-doomed-private/
https://www.businessinsider.nl/tesla-going-private-makes-sense-heres-why-2018-8?international=true&r=US
https://www.theatlas.com/charts/H1KNB-DhV
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