Tesla Motors Inc., the electric-car maker led by Elon Musk, gained 2.8 percent after expanding a stock offering.
Tesla rose to $29.28 at the close in New York after reaching $29.89 earlier. The company, based in Palo Alto, California, said in a regulatory filing today that it expects to sell 6.93 million additional shares at $28.25 each, an increase of 2.58 million from what it reported in a Sept. 25 filing. The earlier filing didn’t list a price.
The company said it expects to receive net proceeds of $192.7 million, or $221.6 million if the underwriter, Goldman Sachs Group Inc. (GS:US), exercises its option to purchase additional shares in full. Chief Executive Officer Musk, who this week lowered the output forecast for the Model S sedan, said he will purchase as many as 35,398 shares at a price of about $1 million.
“The quality and reviews of the Model S, the existence of a multiple stage product plan beyond the Model S and Model X, and the quality of the operation is behind the support for the stock,” said Alan Baum, principal of auto-industry forecaster Baum & Associates in West Bloomfield, Michigan.
Tesla (TSLA:US) expects to deliver 200 to 225 Model S cars in the third quarter and 2,500 to 3,000 in the fourth. The company’s previous forecast was for 5,000 Model S deliveries this year. Tesla is counting on demand for the Model S, which has a starting price of $57,400, to help the automaker earn its first quarterly profit. The Model X is a sport-utility vehicle planned for 2014.
To contact the reporters on this story: Mark Clothier in Southfield, Michigan at firstname.lastname@example.org.
To contact the editor responsible for this story: Jamie Butters at email@example.com