Tesla’s Elon Musk inches closer to his big payday

- Advertisement -
- Advertisement -
- Advertisement -
- Advertisement -

Tesla Inc. Chief Executive Elon Musk is close to getting a windfall that would dwarf any payday for star Silicon Valley executives as the electric-car maker predicts it could reach a key milestone within months.

As MarketWatch reported in January, as part of a performance-award agreement in Musk’s 2018 compensation package, the Tesla TSLA, -2.75% CEO stands to receive options to purchase shares if Tesla reaches certain benchmarks, an important one being a market capitalization averaging $100 billion for six months.

Tesla’s market value is currently at $143 billion, nearly seven times the market value of Ford Motor Co. F, +5.02% and four times that of General Motors Co. GM, +1.33% The six-month average is around $97 billion.

Tesla predicted that it will hit that $100 billion market-cap milestone within the next two months, “if the value of Tesla’s closing stock price continues near the levels seen in late April 2020,” the company said in a filing Tuesday.

After the Tesla board certifies the $100 billion market cap average, then Musk would have the option to buy about 1.7 million shares at $350.02 a share. Selling them at Tuesday’s prices would mean a paper profit around $725 million for Musk.

By comparison, Google’s parent Alphabet Inc. disclosed last week that Chief Executive Sundar Pichai’s total compensation for 2019 topped $280 million thanks to stock awards tied to his promotion to chief executive of the entire company.

Tesla shares have shown resilience amid the economic destruction caused by the coronavirus, even as San Francisco Bay Area authorities have extended through the end of May a regional shelter-in-place order that has kept businesses, including Tesla’s sole U.S. car-making plant, shuttered since late March.

The shares have gained 85% so far this year, contrasting with losses of 11% and 15% for the S&P 500 index SPX, 0.20% and the Dow Jones Industrial Average. DJIA, 0.34%

That outperformance holds in a 12-month comparison as well, with Tesla shares up 230% while the S&P 500 fell 2.4% and the Dow lost 9%. On Feb. 19, Tesla’s stock reached a record closing high of $917.42.

Tesla is scheduled to report first-quarter results on Wednesday, with investors keeping an eye out for any changes on Tesla’s goal to sell more than half a million vehicles in 2020.

Originally Published on MarketWatch

Home of Science
Follow me

- Advertisement -

Discover

Sponsor

Latest

How ‘the single best trade of all time’ netted one investor a $2.6 billion profit

Bill Ackman had a hunch back in February that the coronavirus pandemic would have a greater impact on the stock market than investors were...

You’re not the only one skeptical of the stock market rally

Just because stocks have scrambled nearly all the way back to their record heights doesn’t necessarily mean the market is in the clear. Stocks have...

Netflix Movie Releases

Netflix is a perfect choice for the internet community and the general public. It offers all the latest movies, TV shows, music, books, and...

Democratic Senator: Trump’s executive order on tech would silence the ‘little guy

Sen. Ron Wyden on Tuesday slammed President Donald Trump’s executive order signed last week, which seeks to strip online platforms of liability protections for editing or removing user-generated...

Oprah is the Voice of the Poor – Here is How She Started Her Career

Oprah is the Voice of the Poor - Here is How She Started Her CareerOprah Winfrey was once considered to be the voice...
Home of Science
Follow me