Tesla sells $1.8B of bonds(NASDAQ:TSLA) says it raised $1.8B, $300M more than expected, at a 5.3% yield in its first traditional bond offering, marking a vote of confidencein the company and another sign of investors’ appetite for corporate debt at a time when government bonds provide meager returns.
TSLA is “at the right place at the right time with the right product,” says CreditSights analyst Hitin Anand.
Goldman Sachs was the lead underwriter of the eight-year bonds, which were rated B- by S&P and B3 by Moody’s.
Efraim Levy of CFRA says the bond investors are expecting profitability from TSLA’s more affordable Model 3, but “by 2025 there’s no more room for excuses.”
The deal “speaks to the sheer insanity found in the high-yield market to have a deal like this upsized with terms so unappealing to investors,” says Larry McDonald of The Bear Traps Report. “Congrats to Elon Musk.”
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