Tesla Inc. shares rose in anticipation of Elon Musk stepping back from Twitter Inc., the social media company that has distracted him from running the electric-car maker for months.
(Bloomberg) — Tesla Inc. shares rose in anticipation of Elon Musk stepping back from Twitter Inc., the social media company that has distracted him from running the electric-car maker for months.
Tesla’s stock advanced 0.7% as of 10:10 a.m. Monday, paring an earlier gain of as much as 3.3%. The shares have dramatically underperformed benchmark indexes since Musk took a stake in Twitter in early April and closed the acquisition in late October.
Musk, 51, tweeted Sunday that he would abide by the results of a poll asking whether he should step down as head of Twitter. Users cast more than 17.5 million votes, and 57.5% were in favor of him relinquishing the role.
Tesla’s chief executive officer has previously taken his cues from Twitter users on decisions ranging from whether he should trim his stake in the car company, to if he should reinstate former President Donald Trump’s account. Whereas Musk’s decisions after those polls were relatively straightforward, it’s less clear what he’ll do next with Twitter. Musk has tweeted that it will be difficult to find another CEO and written that the company “has been in the fast lane to bankruptcy since May.”
“No one wants the job who can actually keep Twitter alive,” he said in another post. “There is no successor.”
Analysts at Oppenheimer & Co. said in a note Monday they remain concerned about Twitter-related risks for Tesla and downgraded the stock to the equivalent of a hold rating.
While Oppenheimer’s team led by Colin Rusch has “tried to separate Elon Musk’s non-Tesla endeavors” from their analysis of the company, Musk’s acquisition and management of Twitter “now make that separation untenable.”
Tesla closed last week at a two-year low, costing Musk his position atop the Bloomberg Billionaires Index. While its CEO has been preoccupied with Twitter, the carmaker has been cutting prices and production in China and offering incentives for customers to take delivery of vehicles in the US.
–With assistance from Thyagaraju Adinarayan, James Cone and Kit Rees.
(Updates with Oppenheimer’s downgrade in the sixth paragraph.)
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