Analyst approve of electric-car maker raising $750m selling common stock and $1.6bn from convertible bonds
Analyst approve of electric carmaker raising $750m selling common stock and $1.6bn from convertible bondsTesla CEO Elon Musk. Picture: REUTERS/BRENDAN McDERMID
“The raise should refute lingering concerns about Tesla’s ability to access capital markets,” Ben Kallo, a Robert W Baird & Co analyst who rates Tesla the equivalent of buy, said in a note on Friday. “Surplus cash should help alleviate investor concerns around liquidity.” “We view this as a clear net positive for Tesla,” Dan Ives, an analyst at Wedbush Securities, said in a note. The electric carmaker needed to “take its medicine and clear the air of the very real investor worries.”
After reporting a loss per share that was double what Wall Street expected, Musk sought to assure investors on Tesla’s April 24 earnings call that the company would return to profitability in the third quarter. He told analysts there was “merit to the idea of raising capital” to expand.
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