AP
- Tesla shares soared to a record high Monday, ripping past CEO Elon Musk’s previous target price of $420 per share.
- The automaker jumped as much as 3.6% in early trading after a Reuters report detailed Tesla’s plans to take a $1.4 billion loan from Chinese banks to fund its Shanghai factory.
- The $420 per share threshold was made famous in August 2018 when Musk tweeted that he would take Tesla private at that level, adding the now-infamous phrase “funding secured.”
- Musk acknowledged the stock jump at 11:02 a.m. ET, tweeting “Whoa … the stock is so high lol.”
- Watch Tesla trade live here.
Tesla soared to a record high of $420.40 per share early Monday, reaching CEO Elon Musk’s fabled target 503 days after his infamous “funding secured” tweet.
The automaker jumped as much as 3.6% in early trading following a Reuters report that Tesla will take a $1.4 billion loan from Chinese banks. The funds will go toward the company’s Shanghai factory, three sources familiar with the plans told Reuters.
Tesla will work with China Construction Bank, Agricultural Bank of China, Industrial and Commercial Bank of China and Shanghai Pudong Development Bank, among other firms. The banks previously offered Tesla up to 3.5 billion yuan ($499 million) due for repayment on March 4, 2020, according to a Securities and Exchange Commission filing dated March 1, 2019.
Musk acknowledged the stock jump at 11:02 a.m. ET, tweeting “Whoa … the stock is so high lol.”
The $420 per share threshold was immortalized by a tweet from the electric-automaker’s CEO on August 7, 2018. With no prior warning, Musk announced he was “considering taking Tesla private at $420,” and ended the message with the phrase “funding secured.”
Subsequent tweets revealed Musk wanted to create a “special purpose fund” to allow outsiders to continue investing in Tesla and let existing shareholders convert into private investors.
The SEC issued subpoenas to Tesla concerning the tweet just one week later, inquiring whether Musk’s statements were truthful or if he was misleading investors.
By late September the regulatory agency filed a lawsuit against the CEO, alleging he made “false and misleading statements” in the tweet. The regulator claimed the meeting between Musk and the fund participating in a buyout “lacked discussion of even the most fundamental terms of a proposed going-private transaction.”
Musk settled with the SEC two days after the lawsuit was announced, agreeing to pay a $20 million fine without admitting wrongdoing.
Tesla traded at $419.56 per share at 11:10 a.m. ET Monday, up roughly 26% year-to-date.
The company has 11 “buy” ratings, 10 “hold” ratings, and 15 “sell” ratings from analysts, with a consensus price target of $293.71, according to Bloomberg data.
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