Billion Dollar Investment in Trust: Elon Musk Buys a Huge Stake in Tesla
Tesla's electric shares jumped more than 6% during pre-market trading on Monday, benefiting from a wave of optimism sparked by its CEO Elon Musk after he announced his largest personal stock purchase in years.
Financial data revealed that Musk purchased nearly 2.57 million shares of Tesla stock last Friday, at a total cost of approximately one billion dollars, at varying prices. This deal, according to "Verity" data, is the largest by value that Musk has ever executed, far surpassing his last purchase on February 14, 2020, when he invested 10 million dollars to buy only 200,000 shares.
This massive investment comes at a time when the stock has been under pressure since the beginning of 2025 due to slowing sales, which is partly attributed to Musk's political activities and their negative impact on the brand image, in addition to the cancellation of some financial incentives for electric cars during President Donald Trump's administration. Despite this, the stock has risen more than 25% over the past three months.
Wall Street analysts remain divided on the stock's future. Estimates from "TipRanks" suggest that the average price target anticipates a decline of about 20% from current levels. In contrast, optimists rely on Musk's long-term vision and his ability to steer the company towards focusing on future technologies such as self-driving, artificial intelligence, and robotics.
Dan Ives, head of global tech research at Wedbush, commented on the deal, saying: "This deal represents a huge vote of confidence for Tesla bulls, showing that Musk is doubling down on the future of AI at the company."
This personal investment follows Tesla's announcement earlier this month of its intention to seek shareholder approval for a new compensation package for Musk, which could be worth up to 975 billion dollars if ambitious goals are met. Before the recent purchase, Musk owned about 13% of the company's shares. Musk is also seeking shareholder approval for an investment from "Tesla" in his AI startup, "X.AI".
