Is Musk's big payday make-or-break for the Tesla share price?
The Tesla (NASDAQ: TSLA) share price surged ahead of the company's annual shareholder meeting on Thursday, 6 November. The main focus was CEO Elon Musk’s proposed pay package, potentially worth up to $1 trillion.
The debate isn’t merely about the sum involved, but the concern Musk might leave if the deal is rejected. Musk himself expressed:
[translate:“My fundamental concern … if I go ahead and build this enormous robot army, can I just be ousted at some point in the future?“]
The payout isn’t in cash but a stock package, contingent on Musk achieving ambitious performance targets over the next decade. If successful, Tesla’s market cap could soar to $8.5 trillion, more than five-and-a-half times its current $1.5 trillion value.
Several investors believe the risk is worth it if Musk drives Tesla’s share price so high. Among supporters is Ark Invest CEO Cathie Wood, who has predicted a Tesla stock price of $2,600 by 2029, aligning closely with the target market capitalization.
However, some major investors, including Norway’s sovereign wealth fund, holding 1.2% of Tesla, oppose the pay package proposal.
Ultimately, Musk’s leadership and performance goals are pivotal for Tesla’s future valuation and investor confidence.
Author’s summary: Elon Musk’s massive pay package hinges on Tesla’s growth, with investors split on whether the CEO’s ambitious targets justify the $1 trillion stock award.
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