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• Tesla about to achieve further goals
• Payday for Elon Musk is imminent
• $ 3 billion for the CEO?
Fans and investors of the electric car manufacturer Tesla are likely to be excited about the company’s upcoming quarterly report. And also for Tesla boss Elon Musk, the balance sheet presentation is of elementary importance, because he beckons the payment of a tranche in the amount of 3 billion US dollars.
Fourth tranche in sight
Because Elon Musk doesn’t get a normal salary for his job as Tesla CEO, but has tied his pay to various milestones for his company. If the electrical manufacturer achieves his goals, money flows into Musk’s coffers. After this agreement, which Musk made with the automaker in 2018, seemed too ambitious for a long time, Tesla has now had a real track record and has already achieved some of the agreed goals.
Another is now within reach: The company has achieved an average market capitalization of $ 250 billion in the past six months – a new milestone on the way to paying out the fourth of a total of 12 agreed tranches, reports Reuters.
Billions in equity options within reach
With each tranche, Elon Musk acquires the right to purchase 8.44 million Tesla shares at a price of $ 70 each, one sixth of the current market price. According to Reuters, the Tesla CEO could redeem the options and, combined with the three tranches previously acquired, could make a profit of $ 11.8 billion on the sale of the shares, or around $ 3 billion per tranche.
Good news for Tesla – bad news for shareholders
But the expected rain of money for Elon Musk could cost Tesla an inclusion in the S&P 500, the Wall Street Journal recently warned and pointed out that the milestone payment to the Tesla CEO would be at the expense of profit development. “These new issues threaten to jeopardize Tesla’s streak of GAAP earnings for four consecutive quarters. For those four quarters, Tesla has posted average net income of approximately $ 70 million per quarter,” it said. Inclusion in the important stock market index is only possible if the car manufacturer is profitable for four consecutive quarters.
Finanzen.net editorial team
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