Tesla Motors
TESLA Motors IPO June 2010 By: Brad Taylor
Tesla Motors, Inc. was formed in 2003 to design and produce affordable EV’s (electric vehicle) and sell into the mainstream market place. The company is in the auto manufacturing industry and the consumer goods sector. To sustain its significant cash flow needs to support its heavy research and development spending and growing infrastructure needs (dealerships), the company completed a public offering in June of 2010 where it sold 13.3 M shares at a price of $17.00 in a successful IPO that raised $226.1 M and listed Tesla on the Nasdaq (TSLA). Combine the $226.1 M raised with its IPO, with its four private offerings, various investments from other partners, $465 M in term debt from the DOE and its $170 M raised from its secondary offering of 5.3 M shares of stock, the company has raised staggering amount of roughly $1242.7M ($1,054M if you exclude the $188.7M balance yet to be drawn of the DOE loan) since it began in 2003. There is still the question, is it enough?
The IPO was originally slated to offer 11.3 M shares at a range of $14-$16 each, but due to the demand, Tesla, along with its investment bankers of Goldman Sachs, Morgan Stanley, JP Morgan and Deutche Bank increased the available shares by 20% and the offering price to $17. By the closing bell on opening day, the stock had risen to $23.89 and traded 18 M shares. Since then the stock has appreciated to $30.79 at the time of this report representing an 81% and 30% return to its shareholders from its opening day price $17 and closing price of $23.89 respectively. Trading on average 1.2 M shares daily, its 52 week range is $21.50 - $39.95.
In the short term, it would appear that both the IPO and the company have been a success. With the IPO generating in excess of $226 M, and the company, while not paying dividends, returning 30-81% to its shareholders (based upon first day opening and closing values) – a healthy 2 year return. The real test for the long
Tesla Motors, Inc. was formed in 2003 to design and produce affordable EV’s (electric vehicle) and sell into the mainstream market place. The company is in the auto manufacturing industry and the consumer goods sector. To sustain its significant cash flow needs to support its heavy research and development spending and growing infrastructure needs (dealerships), the company completed a public offering in June of 2010 where it sold 13.3 M shares at a price of $17.00 in a successful IPO that raised $226.1 M and listed Tesla on the Nasdaq (TSLA). Combine the $226.1 M raised with its IPO, with its four private offerings, various investments from other partners, $465 M in term debt from the DOE and its $170 M raised from its secondary offering of 5.3 M shares of stock, the company has raised staggering amount of roughly $1242.7M ($1,054M if you exclude the $188.7M balance yet to be drawn of the DOE loan) since it began in 2003. There is still the question, is it enough?
The IPO was originally slated to offer 11.3 M shares at a range of $14-$16 each, but due to the demand, Tesla, along with its investment bankers of Goldman Sachs, Morgan Stanley, JP Morgan and Deutche Bank increased the available shares by 20% and the offering price to $17. By the closing bell on opening day, the stock had risen to $23.89 and traded 18 M shares. Since then the stock has appreciated to $30.79 at the time of this report representing an 81% and 30% return to its shareholders from its opening day price $17 and closing price of $23.89 respectively. Trading on average 1.2 M shares daily, its 52 week range is $21.50 - $39.95.
In the short term, it would appear that both the IPO and the company have been a success. With the IPO generating in excess of $226 M, and the company, while not paying dividends, returning 30-81% to its shareholders (based upon first day opening and closing values) – a healthy 2 year return. The real test for the long