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Tesla Stock Pops As Musk's Account Tweets Plan To Take Company Private

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Shares of Tesla (TSLA - Free Report) surged about 6% in early afternoon trading hours Tuesday after Elon Musk, the polarizing CEO of the electric car giant, tweeted that he was considering taking the company private.

Musk’s tweet, which was sent in late morning hours Tuesday, implies a take-private price of $420 per share for Tesla.

 

 

Musk has yet to follow up the tweet with more details. The tweet was posted on his verified account, although no additional confirmation has been made.

A deal to take Tesla private at $420 per share would mark a nearly 23% premium to the stock’s most-recent closing price.

Shares of the automaker were trading relatively flat on the day ahead of the tweet. Shortly afterwards, Tesla popped to an intraday high of $371.15 per share, up about 8.5% from Tuesday’s close. By 1:00 pm EDT, the stock had retreated back toward the $360 level.

Tesla shares had surged about 7.4% heading into the day. Last week, the company reported an adjusted quarterly loss of $3.06 per share, which was wider than the Zacks Consensus Estimate of a $2.78 per share loss.

However, investors were excited about the company’s revenue growth and production outlook. Sales in the quarter increased to $4 billion from just $2.8 billion in the prior-year period, and management had positive things to say about production of Tesla’s ever-important Model 3 sedan.

Elon Musk has clashed with bearish analysts in recent months as Tesla has struggled to reach previously-stated goals for Model 3 production. The CEO has also faced public criticism after posting disparaging comments about a diver who assisted in the Thai cave rescue.

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