Elon Musk raises hopes for a Tesla inventory buyback with a one-word tweet

• Elon Musk fueled hypothesis that Tesla might quickly announce its first-ever inventory buyback.
• Responding to a tweet from a prime Tesla investor who mentioned solely a buyback or a doubling in revenue might break the inventory’s hunch, Musk mentioned “Famous.”
• Leo KoGuan, who says he’s the third largest particular person Tesla shareholder, has beforehand referred to as for a buyback of $5 billion this yr and $10 billion subsequent yr.

Elon Musk added additional gasoline to hypothesis that Tesla might buyback inventory for the primary time.

On October 3, Leo KoGuan — who claims to be the EV maker’s third-largest particular person shareholder — tweeted, “Tesla is having PE ratio compression that may be solved solely by buyback and/or by 2x earnings enhance.”

On Thursday, Musk replied “Noted.”

KoGuan beforehand referred to as for a repurchase when shares have been falling in Could. On the time, he mentioned Tesla ought to announce plans for a $5 billion buyback this yr and a $10 billion buyback subsequent yr.

On Friday, Tesla inventory was down 6% at $207.84 and has tumbled greater than 40% this yr amid aggressive rate of interest will increase from the Federal Reserve, fears of a recession, and Musk’s Twitter takeover bid, which might contain his Tesla shares.

He’s presently going through headwinds from his pursuit of Twitter, which mentioned in a regulatory submitting Thursday that Musk is being investigated by federal authorities for actions associated to his bid.

A Delaware decide has additionally given him till October 28 to finalize the deal or go to trial with the social media firm and face a possible breakup charge. Studies have additionally surfaced in latest days that Musk is liable to shedding his financing for the deal. 

In the meantime, Tesla is about to report third-quarter earnings on October 19.