Tesla falls to its lowest level since June 2021 as Elon Musk turns attention to Twitter turnaround and fears grow of more stock sales
Investors aren't happy that Elon Musk has reportedly tapped a team of Tesla engineers to help turn Twitter around.
Muhammed Selim Korkutata/Getty Images
- Tesla fell 5% on Monday to its lowest level since June 2021 as CEO Elon Musk leads a turnaround at Twitter.
- Fears are mounting that escalating losses at Twitter could force Musk to sell more of his Tesla stake.
- Several companies have paused their advertising spend on Twitter after Musk bought the company.
Tesla stock fell as much as 5% on Monday to hit its lowest level since June 2021 as CEO Elon Musk turns his attention to leading a turnaround at Twitter.
Musk completed his $44 billion purchase of the social media company late last month. Since then, several companies have paused their advertising spending on the platform, a move that has the potential to lead to mounting losses for Musk.
According to Loup Ventures' Gene Munster, the growing losses at Twitter could force Musk to sell more of his Tesla stake if a turnaround isn't realized soon.
"They have a month here to kind of kitchen sink things and get people to reset with what their products are and get advertisers to understand what their content moderation is," Munster told CNBC on Monday. "If that yields the current environment, he's gonna have to sell Tesla shares in April."
Meanwhile, Tesla investor Gary Black of the Future Fund ETF, which counts Tesla as its largest holding, isn't happy about Musk's diverted attention away from Tesla and towards Twitter. Nor is he happy about reports that some Tesla employees are helping Musk stage a turnaround at Twitter.
"$TWTR news keeps getting worse. Elon's top engineers shouldn't be running $TWTR. Elon's threats aren't helping. As advertisers leave, Twitter will need to raise more $," Black tweeted on Monday.
Tesla's decline on Monday sent the stock to a low of $196.66, and shares in the afternoon were struggling to reclaim $200, which represents a significant support level for traders. A decisive close below $200 would signal to investors that there could be further downside ahead.