Tesla Motors shares fell more than 15 percent yesterday as the automaker’s “lock-up period” expired, flooding the stock market with shares. What is a “lock-up period” you ask? Well, in terms of Tesla’s stock, the lock-up was a 180 day period in which sales of some of Tesla’s shares after its IPO were restricted.
Starting Monday, owners of 75 million shares could sell their stock, according to a filing with U.S. regulators.
Tesla made its debut on the NASDAQ in late June, after which its shares increased more than 40 percent. However analysts have been a bit harsh towards to stock with Capstone Investments analyst Carter Driscoll initiating Tesla at a “sell” with a $22 target. He said that the company will not grow as quickly as expected.
Tesla Motors is currently preparing to launch its Model S electric sedan in 2012. The U.S. Department of Energy loaned Tesla $465 million in March to develop the Model S.
Tesla stock closed yesterday at $25.55 per share, falling $4.54 or 15.09 percent.
– By: Omar Rana
Source: Automotive News (Subscription Required)