Investors thought Elon Musk was trying to save SolarCity from a sliding share price. Musk is, after all, a founder of and major investor in both companies. He stands to lose a lot of money if SolarCity goes under, meaning his incentives aren’t identical to those of an average TSLA stockholder. Naturally, that makes investors a little wary.
Strangely enough, none of those things sent TSLA stock into a downward spiral. The share price has kept fairly even at $234.30, which is odd considering the initial reaction to the deal. Why isn’t TSLA stock plummeting like when the deal was first announced?
Let’s take a closer look…
At first blush, the markets hated the Tesla-SolarCity merger, but that’s only because it didn’t understand it. The markets viewed the move as a public relations stunt, as damage control.
But then Elon Musk released his “Master Plan, Part Deux” for Tesla. In just one blog post, he explained his vision of where the company is headed. It managed to inject a sense of calm and resilience into TSLA stock, which is why Tesla’s share price is level this week.
In the post, Musk talked about Tesla’s continually expanding product lineup and what the company intends to build after the “Model 3” production is sufficiently scaled. Most people would have guessed that he’d pursue an even more affordable electric car. Well, those people would be wrong.
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