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Electric vehicles

Tesla Grants Elon Musk $29 Billion Stock Award Despite Recent Turbulence

Strategic Insights

— 1 min read

Tesla's electric vehicle maker, has rewarded its billionaire CEO Elon Musk with a $29 billion stock grant, citing his transformative growth and leadership of other companies, including SpaceX and xAI. The move comes as the company faces declining sales, profits, and stock price due to Musk's recent involvement in right-wing politics. The grant, which is the largest in Tesla's history, is intended to retain Musk as CEO and keep him focused on the company's growth. According to Wedbush analyst Dan Ives, the grant may alleviate some shareholder concerns and keep Musk at the helm until 2030.

Key Takeaways:

  • Tesla has granted Elon Musk 96 million restricted shares worth $29 billion as a reward for his transformative growth and leadership.
  • The grant is the largest in Tesla's history and comes despite recent declines in sales, profits, and stock price.
  • Musk's involvement in right-wing politics has hurt Tesla's sales and profits, with quarterly profits plummeting from $1.39 billion to $409 million.
  • Musk must first pay Tesla $23.34 per share of restricted stock that vests, which is equal to the exercise price per share of the 2018 pay package.
  • The 2018 pay package carried a potential maximum value of about $56 billion, but the sum has fluctuated over the years based on Tesla's stock price.
  • Tesla has appealed the revocation of Musk's 2018 pay package, which was ruled against by a Delaware court.
  • Wedbush analyst Dan Ives believes the grant may keep Musk as CEO until 2030 and alleviate some shareholder concerns.
  • Tesla's stock rose nearly 2% in midday trading after the announcement.

Statistics:

  • $29 billion: The value of Elon Musk's stock grant
  • 96 million: The number of restricted shares granted to Elon Musk
  • $1.39 billion: Quarterly profits before decline to $409 million
  • 25%: The decline in Tesla shares this year
  • $735 billion: The increase in Tesla's value on the stock market since 2018
  • 2%: The rise in Tesla's stock price in midday trading

Sources:

  • The Associated Press (2023) - (Exact date not provided)
  • Tesla's regulatory filing (December 2023) - (Exact date not provided)
  • Wedbush analyst Dan Ives' client note (Exact date not provided)

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