NEW YORK: Tesla Inc chief executive Elon Musk (pic) told employees that they should not be “bothered by stock market craziness” after the company’s shares fell nearly 70% this year on jitters over softening demand for electric vehicles and his distraction with running Twitter.
In an email sent to staff on Wednesday (Dec 28) and reviewed by Reuters, Musk said he believes that long term, Tesla will be the most valuable company on Earth. He also urged employees to make a push to deliver vehicles at the end of this quarter, after the automaker has offered discounts to its vehicles in the United States and China.
“Please go all out for the next few days and volunteer to help deliver if at all possible. It will make a real difference!” he said in the email.
“BTW, don’t be too bothered by stock market craziness. As we demonstrate continued excellent performance, the market will recognise that,” he said.
Musk said in the email: “Long term, I believe very much that Tesla will be the most valuable company on Earth!”
Tesla’s plummeting share price hurt the value of shares owned by the EV maker’s employees. The company has offered stock compensation for most employees including factory workers.
Shares of Tesla snapped a seven-session losing streak on Wednesday, in their rare rise this month on the way to what will be the electric-vehicle maker’s worst year on record.
The stock gained 3.3% on the day. It is set to round off 2022 with a 68% drop – the most among the big US technology firms.
“The shorts are piling on and the stock is way oversold here, which could drive a bounce-back rally,” Wedbush analyst Dan Ives said.
Tesla short sellers stand to book a profit of US$16.94 billion, their first gain since at least 2016, compared with a US$10.26 billion loss last year.
“When Tesla’s stock begins to tick upwards there should be a flurry of short covering … as shorter-term short sellers look to realise their outsized mark-to-market profits before they evaporate,” said Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners.
Short sellers borrow shares to sell them on the open market in the hope of buying them back at a lower price and pocketing the difference.
There could be more short selling until a firm-priced floor is established, Dusaniwsky said.
The stock also saw high trading volumes on Wednesday with 211.54 million shares changing hands, 79% above the 25-day average volume. – Reuters
