Tesla Raising Money From Elon Musk & Others! Whats It Mean For Tesla Stock?

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Well guys we have a capital raise coming out of tesla here today i want to share the full details around this capital race i want to talk a bit about my opinion on it in kind of a lot of people aren’t understanding why they would raise capital in this situation i want to explain that okay so first off here if we look at tesla stock it’s having obviously a very good

Day of about three and a half percent i think you know as of now i think it’s up over four percent actually but neither say it’s best eight tesla’s hadn’t in a little while now and especially on the day when the markets having a rough day poni stocks are actually having really bad days but there you have tesla having a good one you tesla let’s do opposite of what

The market that’s okay so tesla said thursday it plans to raise up to two billion dollars with 1.35 billion dollars coming from convertible notes in 650 million dollars from new equity including a big purchase from ceo elon musk a big is relative and it finally must signal to his intent to buy about ten million dollars of the electric automakers stock in the new

Offering the total equity offering is for 2.7 million shares of tesla must purchase would be about forty one forty two thousand shares before the offering obviously must go and around 20 percent of tesla’s outstanding shares worth about twelve point six billion dollars the move obviously comes one week after the whole earnings came out obviously last week was a

Tesla earnings they had a lot of questions on the conference calls some of them were directed around if the company would raise capital and things like that okay on that conference called must said i don’t think raising capital should be a substitute for making the company operate more effectively must hold shareholders on the company’s a conference call last week

I do think there’s some merit to raising capital but this is sort of probably about the right timing on that conference call must definitely hinted around that the company was interested in possibly raising capital and now a week later obviously we see the company does raise capital no what’s interesting about this is if you look at the stock performance after

Any time when musk purchase shares recently you’re gonna find that the stock have performed unreal after those purchases okay so if we look at this here must purchases have been a reliable short-term buy signal for the stock according to insiders score comm following the last five purchases by musk the shares were higher on average by 41% in the next three months

According to insiders score so needless to say that is unbelievable stock performance for tesla after you know elon must purchase share so if you’re if you’re someone that plays stocks for short-term which i definitely am not in i’m not interested in doing that but if you are a short-term player you kind of look at something like this and you say okay shares usually

Go up around 41% you know the basically the next three months after elon purchases some shares might be interesting time to do that or something like that obviously for me personally that has nothing to do with like me purchasing tesla shares or not i’m buying tesla shares for the long term by the way i just bought a bunch of tesla shares yesterday okay no i want

To go through some things on seeking alpha seeking alpha you know basically people leave comments and i want to go through some of these comments some of them i think have some merit to them some of them i wanted to kind of debunk here okay this comment says 10 million from elon is a pr ploy and i will say i do kind of agree with that obviously that’s the kind of

Like a short seller attack they’re always not really and i do kind of agree that that 10 million dollars for elon musk is like you or i going to buy a can of soda like it’s literally like pretty much nothing for him the guy’s worth twenty twenty something billion dollars okay he’s got twelve point six billion dollars in tesla shares alone he obviously has properties

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He has a huge ownership stake in spacex which that valuation is just continuing to increase so ten million dollars worth of shares for elon is like it’s literally like i will agree with that it’s almost like a prp like that is nothing to him because the little guy has so much money ten million is like it’s like a literally like a can of soda okay that’s what it

Honestly is for him okay this one says tesla behaves the opposite of a normal stock without this it was bk before the end of the quarter now they can kick the can down the road a little longer all my goodness you know ah gosh i mean i understand you know a lot of short sellers attacked tesla for different reasons but some of them are just pure ignorant like to the

The highest level of ignorance okay the the fact that somebody would think a tesla would be bankrupt before the end of this quarter without a capital raises like you you could don’t understand like financial statements like what the company is doing like no that company’s not going like tesla doesn’t have to raise money to avoid bankruptcy or something like that

Tesla’s raising money so they can do some project says they have a lot of projects that are very costly over the next 12 to 18 months they have nothing do a tesla ohmygosh going bankrupt like it appear ignorant and i’m not sure there’s some of these short show the sellers just like to troll or something like that but it’s like like wake up short sellers like if you

The fact that 27 people like that comment just kind of proves that the ignorance of the short seller community and specifically on seeking alpha you know a lot of them are just delusional that they would actually think tesla could go bankrupt and then it like literally just clueless okay this one says in another short seller myth tesla can’t race capital is dying

We need too many growth opportunities have this business star from cash concerns at this point now it’s all about execution and then cash comes rolling in the second half of the year bravo elon and right decision lots of puto options about to expire worthless now also what’s the point of being short now this was the best point of the shorts thesis well deserved for

Fighting on the wrong side of climate change and i will say that was always such a silly it was such a silly like short seller myth out there that tesla can’t raise money or tesla’s not going to be able to raise money i’m like who in their right mind literally thought that well obviously short sellers think that okay so i can understand that some people think that

But it’s like you have to be completely clueless to not understand like tesla can raise money from anybody that’s a hottest car company by a mile in the entire world and there’s no one even close to them okay you know that by far and away the hottest electric car company in the world or just car company in general anybody will loan them money okay they can take

Out bonds they can raise you know they can basically just they could offer new sheriffs the market they can do whatever they want they can take investments from whether you don’t either vc funds venture capital funds or they can take investments from you know other tech companies i’m sure ton of tech companies with law i love to make a big investment in tesla if

Tough so welcome that okay it doesn’t mean to have you know tesla would welcome you know a big big you know investor basically another big tech company at google or an apple or amazon or someone like that investing in them but i’m sure if tesla went to them and said yeah i’m sure if tesla went to apple and said hey we want to give you guys a big ownership in the

Company and you guys give us a certain amount of capital or whatever i’m pretty sure apple would take up on that okay i’m pretty sure most big tech companies you know that are very profitable companies right now if tesla and elon musk went to them and said hey we have a plan we’re gonna give you a certain amount of ownership and basically we want to raise money

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From you i’m pretty sure like a lot of them would go ahead and do that in a snap of fingers okay so though the whole short thesis around tesla can’t raise money it’s like like you have to be completely clueless to like really believe that tusla can’t raise money any more attacks it’s just it’s beyond silly it’s beyond silly okay this person i likes to do a little

Short seller hatred okay says cash execution is what elon does best they incinerate it loons willing to lose even more money would be funny hearing the sales pitch of the reasons to throw your money in a dumpster fire if you want to call building the most popular electric car in the entire world if you want to talk about building a potential fleet of autonomous

Vehicles and burning money then you can i guess call it that but in my opinion i call this innovation at the highest level and these type of things just aren’t easy to do they are very costly things okay the fact that in that you know tesla has gotten to this level most people thought it was impossible for tesla to get to the level they’re at right now nevermind

Where they’re going in the future these projects are unbelievably complicated to solve okay electric vehicles trying to make a cost affordable electric vehicle autonomous driving trying to make you know vehicles that can a fully autonomous drive these are very costly problems to solve okay these don’t just happen and snapping fingers that’s why they haven’t just

Happened in a snap of fingers they’re extremely costly and they’re extremely complicated to solve and so to say tesla’s just burning money to burn money is like are you looking at the products they’re putting out these products are unbelievable okay they’re on a whole other level than anything we’ve seen in the history of the world so the fact that somebody you

Know short-selling say they burning money it’s like look at the products look at the results okay this short seller says what the hell will the interest rate be for these bonds should be somewhere north of 8% can’t believe the bond market still open for at us oh my gosh he’s ranting can’t believe then i can’t believe the bond market is still open for tesla they

Need to close that man oh my gosh what leg like it’s unbelievable you got the literally one of the hottest companies in the entire world that most people would gladly throw money at or invest in and the fact that short sellers think no one with who it alone you toss some money it’s like like i don’t know what planet these people are living on look at the numbers

Tesla’s just put up in literally the last year they grew revenues in most of those quarters at a hundred plus percent name one other big company in the entire world that’s growing that grew revenue is that one hundred plus percent name one of their company that is more well positioned to be a multi hundred billion dollar company over the next five to ten years

In tesla you’re not gonna be able to find one tesla’s an unbelievable company that uh you know people that you know actually have a brain would be willing to actually put some money into okay and short sellers to be shorting the stock thinking no one’s gonna give them money to go after these problems to solve after everything elon musk has proven over the last

Five to ten years is mind-blowing to me guys it’s literally mind-blowing that just i can’t understand these short sellers okay this one says as long as there are fools to buy this the stock price will stay relatively high a 2030 there will burn through a trillion dollars in cash but there’s still be hanging around because next quarter will be the turnaround oh my

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Goodness guys the short sellers they’re just persistent yeah that’s all i could say about that no okay in terms of the obviously with the money’s used for so obviously shanghai they already raised a good amount of money for shanghai i’m not sure if it’s enough to complete the project but they’re already had raised money for shanghai so neither say they probably

Need to raise a little bit more obviously model why assembly needs to be put together there they’ve been talking about doing an assembly plant in europe okay the semis gonna go into production in 2020 they obviously need more service centers in my personal opinion in the us and talking to a lot of people also they need a lot more sale centers in a lot of places in

Europe so needless to say over the next 12 to 18 months tufts is in a position where they need a lot of money to go to a lot of things that’s not like tesla’s just like let’s go burn some money let’s go raise two billion dollars so we can burn it in the air or something tesla a lot of legitimate things going on that are very costly things okay doing a full new

Line for the model wise not something that’s cheap okay the semi the semis going into production in 2020 that’s it it’s something that’s just you know it’s just like free to do let’s just set up a line to build the starts to start building semis okay uh european factory that’s not gonna be cheap okay you’re building anything in europe can be a bit of a challenge

Sometimes with how many permits and regulations and things you have to go through okay that’s gonna be costly you might need a little bit more money to kind of finish off the shanghai factory over the back half of this year okay so need to say tesla is in a position right now where they maybe they could have said let’s not raise money and let’s try to you know cut

More jobs to do things like that and i just think that’s a really bad decision i think they should focus on having high customer service levels making sure their current customers are happy and the new customers coming on i should think they should make sure those folks are happy make sure the customer service levels are there make sure everybody’s you know we’re

Having a good time and whatnot with the tesla experience and then go ahead and raise some money so you can get these these different lines built out the factory’s finished and then go ahead and reap in the profits over the next few years but to kind of starve the business of cash right now doesn’t really make the most sense especially when you’re a company like

Tesla that grew you know most quarters last year a hundred plus percent and when you’re a company that’s kind of in the front of everybody in when it comes to electric vehicles and when it comes to autonomous driving so i’m all for this capital raise i think it was a good decision i you know elon musk i think was in the right frame of mind last year where he was

Like let’s not raise money though so let’s try to you know get this business as a streamlined as possible i think that was a good decision because it put the company more in a mindset of you know raising money was not necessarily a necessity it could just be something that helps a business so i’m thrilled with kind of the decision making there and we’ll see how of

All things go i think it’s gonna go very good it’s just it’s hilarious to me that shorts out sellers literally thought like tesla couldn’t raise any more money it’s mind-blowing to me guys so anyways hope you enjoyed this as always let me know your opinion down there in that comment section okay i want to hear you guys opinion thank you for watching and have a great day

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Tesla Raising Money From Elon Musk & Others! Whats It Mean For Tesla Stock? By Financial Education

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