Thursday’s Tesla pump not only solidified its position as the world’s most valuable car company, it also meant its chief exec Musk has added $20 billion to his wealth since March. But it absolutely wrecked the company’s short sellers, who lost $1.33 billion yesterday according to data shared by industry analyst Ihor Dusaniwsky of data firm S3 Partners.
“Short sellers” borrow shares in what they perceive to be overvalued companies (often through a broker via pension fund). They then sell that borrowed stock right away, and repurchase it when it falls to profit from the difference after returning the shares; the opposite of “buy low, sell high.” [Read: A look inside Europe’s $7 trillion technology market] S3’s analysis found Tesla short sellers are down $15.9 billion dollars so far in 2020, during which time $TSLA has risen by more than 180%. Even worse, Dusaniwski estimates that Tesla short sellers have lost a kidney-bruising $30.45 billion since 2010.
— Ihor Dusaniwsky (@ihors3) July 2, 2020
Tesla sales are up, and so is its stock
Tesla’s most-recent pump coincided with the company’s release of its quarterly earnings, which revealed it had sold 90,650 electric cars — far exceeding the highest industry estimates of 86,000. The company also noted that its factory in Fremont, California is back to operating at “pre-pandemic” levels. Tesla’s solid earnings reportedly pushed many analysts to raise their $TSLA price targets. The impact of Tesla’s stock pumps on the company’s short sellers isn’t lost on Musk, who spent some of Thursday afternoon trolling $TSLA’s bears on Twitter — no doubt fueled by that warm, fuzzy feeling that comes with extra billions.
— Elon Musk (@elonmusk) July 2, 2020
