SMM: Tesla's bulls said the carmaker's planned $2 billion common stock offering on Thursday was "justified" and pushed its share price to an eye-popping $7000 over the next five years.
Cathie Wood, founder and chief executive of ARK Invest, said on social media that Tesla's plan to issue $2 billion of shares was meaningful, underpinning its previous bullish view that the share price could reach $7000 over the next five years. "this plan strengthens our confidence that the company will continue to capture share of the electric vehicle market in the next five years."
Tesla announced Thursday that it would issue $2 billion in common stock. Musk himself will buy up to $10 million in shares, while Tesla board member Larry Ellison (Larry Ellison) will buy as much as $1 million. Tesla said it planned to use the proceeds of the offering "to further strengthen its balance sheet and for general corporate purposes."
With the influx of capital, Wood said she would "not be surprised" if Tesla announced plans to build another super factory in China. This implies "confidence in China's resilience," she said.
At the end of January, Wood raised Tesla's five-year target price to $7000, based on falling costs and growing demand for electric vehicles, as well as the company's growth potential in other areas, such as Robotaxis.
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