A document published on Friday (12) shows that Elon Musk Sold more than 1.2 billion shares Tesla Friday (12), with an average price of $1,030 each. This brings the week’s sales to a total of 6.4 million shares, cumulating $6.9 billion.
However, this amounts to less than 4% of procedures He owns it directly, or less than 3% if you include all the options he has to purchase additional shares.
Since a week, Musk posted a poll on Twitter asking if he should sell 10% of his stake. As a way to increase their tax liability, 58% of respondents said yes.
Stock sales this week Tesla shares reduced the value of shareholders — including himself, because Musk is by far the biggest contributor. Tesla shares ended the week 15.4% lower at $189.
Twitter search is unlikely to be the main driver of the sale. Instead, the entrepreneur faces an impending tax bill that will arise due to his need to exercise 22.9 million stock options before next August. This bill would be approximately $10 billion at current market prices.
If he does not exercise the options by then, they will expire and the right to buy each share for only $6.24 will be forfeited. But when he does, the value of the shares at that time will be treated as regular income and he will have to pay a 40.8% federal tax rate. It is also possible that he owes state income tax to Californiawhich has a maximum rate of 13.3%.
Despite moving to Texas, which does not tax state income, he admitted in a recent post that he still owes California a significant income tax based on how long he has worked in the state.
Musk exercised the first block of 2.2 million of those expiring options on Monday (8) and then sold 934 million shares to pay taxes on the process.
However, the shares he has since sold, however, come from his immediate holdings, most of which he has owned since the initial public offering (underwriting) for the year 2010 for the company. Musk owes only 20% of the long-term capital gains tax on proceeds from those stock sales of $5.8 billion, or about $1.2 billion.
Tesla remains the world’s most valuable automaker, with a market value greater than the 12 largest automakers by volume. Last month, it became the sixth company in United State To achieve a valuation of $1 trillion.
Musk’s participation in the company has decreased slightly with these sales, but at the moment it is still 23.7%, compared to 24.3% he would have had without sales.
As of this week, the entrepreneur hasn’t sold any shares in the company he owns since 2016. But other board members and senior executives have been selling shares all the time, including his brother Kimbal Musk, a Tesla board member who sold $108 million An American stockpiled last week, equal to about 15% of his shares in the company, before his brother’s sales began to drive down the value of the stock.
Elon Musk is the richest person in the world, with Bloomberg estimating his net worth at $294 billion. The $6.9 billion he received from this week’s transactions is already included in this account, as the appraised value of stocks and options is a significant portion of his net worth. Its shares fell this week as Tesla’s stock price fell.
Recent stock sales do not significantly change Musk’s financial position. The $6.9 billion in sales would be like a typical American family selling $2,900 worth of stock they already own. The Federal Reserve’s latest estimate puts median household equity at $121,700.
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