Elon Musk just dished out millions of his own money as part of his war against Tesla haters
- Tesla CEO Elon Musk took his war against short sellers to a new level on Monday, buying an additional R124 million ($9.85 million) of stock in the company.
- The purchase came just three days after Musk taunted short sellers on Twitter — something that's become a favorite pastime of his over the past year.
Elon Musk is putting his money where his mouth is — R124 million ($9.85 million), to be exact.
The Tesla CEO bought 33,000 shares of his company's stock on Monday, according to a regulatory filing. It marked his largest purchase since 2017 and moved Musk's overall stake in Tesla to almost 20%, further solidifying his position as the firm's top shareholder.
The timing of Musk's purchases is conspicuous, considering a tweet from the outspoken CEO on Friday in which he appeared to taunt short sellers.
"Looks like sooner than expected," he tweeted in response to a story about time running out for short sellers, who are positioned to profit from a share decline. "The sheer magnitude of short carnage will be unreal. If you're short, I suggest tiptoeing quietly to the exit."
On a circumstantial basis, it would sure seem that Musk is willing to do everything in his power to make Tesla shorts suffer — even if it means ponying up a chunk of his own money.
With that in mind, it's important to note that Musk's frustration with short sellers hasn't cropped up overnight. It's actually been brewing for the better part of a year — a period that's seen the CEO forge a combative relationship with Tesla stock sceptics, largely using his Twitter account.
In a Rolling Stone profile in November, Musk called short sellers "jerks who want us to die" and characterized their behaviour as "hurtful." Before that, in June, he fired off a tweet in which he said short holders "want us to die so bad they can taste it."
And prior to that, in early April 2017, after a period of considerable Tesla stock strength, Musk tweeted that there was "stormy weather in Shortville," an apparent dig at the company's detractors.
And despite Musk's myriad efforts, Tesla remains the most popular short in the US equity market — a designation it has held for much of the past two years. Short interest, a measure of bets that a stock will drop, sits near R138 billion ($11 billion), outpacing the next-most-shorted company, Apple, by more than R18.9 billion ($1.5 billion), according to data compiled by the financial-analytics firm S3 Partners.
So while the Tesla share appreciation driven by Musk's stock purchases could certainly squeeze some short holders, forcing them to exit their bearish bets, the company's short interest is still astronomically high.
And it'll most likely remain elevated until Tesla can solve some of its lingering production issues — something Musk won't be able to address by purchasing shares and firing off tweets.
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