Is Tesla Stock a Buy After Musk’s $1 Trillion Pay Package Approval?
In an era of inflated tech valuations, Tesla stands out with significant potential. However, uncertainty remains about whether Tesla stock is a buy or a sell.
Elon Musk's New Pay Package
On 6 November, Tesla shareholders approved a pay package for CEO Elon Musk that could award him up to $1 trillion worth of Tesla stock if certain milestones are achieved. This deal makes Musk effectively the world's first trillionaire.
Elon Musk’s leadership is considered vital for Tesla’s long-term success in self-driving cars and robotics, especially as its core electric vehicle business faces challenges.
Market Reaction and Stock Performance
- The pay package was approved by 75% of shareholders at Tesla's annual general meeting.
- By 7 November, Tesla shares had increased approximately 17% over the year despite a volatile period.
- During April, amid tariff issues, Tesla’s stock dropped over 40% since the start of the year.
- Following the slump, optimism returned, pushing Tesla's market capitalization close to $1 trillion.
Investment Considerations
While Musk’s vision fuels confidence, investors should weigh the risks tied to Tesla’s fluctuating stock price and the ambitious targets linked to Musk’s compensation.