- A little over a year since joining Tesla’s board, Larry Ellison’s stake in the electric car maker is up $ (million.)
- The Oracle founder became Tesla’s independent director at a time when the firm was suffering a crisis.
- With Tesla now up (****************************************************************************%, some analysts are beginning to urge caution.
Oracle (NYSE: ORCL) founder Larry Ellison joined Tesla’s (NASDAQ: TSLA)board in late 2020to help steady the ship amid an escalating crisis involving Elon Musk. That move has proved to be profitable as well and not just what would be expected of a seasoned entrepreneur when his younger friend isfacing fire from all directionsincluding the US Securities and Exchange Commission.
Just prior to becoming an independent director on the electric car maker’s board, Ellisonacquired 3 million shares. Though the SEC filing did not reveal the price he bought the stake at, Tesla shares were trading at around $ at the time. The recent Tesla rally which has seen the stock appreciate by nearly (% in the first) ********************************************************************************** days of this year means Ellison’s stake has gone up by over (***************************************************************************%. The stake which Ellison spent $ 1 billion to purchase is now worth slightly over $ 1.6 billion.
Tesla’s gains overtake Oracle’s
That’s not the best part of it for the Oracle founder though. Last year in June, the Oracle founderreceived 60, 06 Tesla sharesas compensation from the electric car maker. At the time of the stock award the shares were trading at roughly $ (***********************************************************************. This has resulted in a gain of (**********************************************************************%. This particular stock award has also recorded paper profits of nearly $ million.
Ellison also received another stock award of 8334 shares in January last year. This raises the tally of the total number of shares he holds in Tesla to 3, (**************************************************************************, 551. The entire stake is now valued at about $ 1. (billion.)
Compared to the gains Tesla has made, the appreciation Oracle has recorded over the same period pales in comparison. Since Decemberth, (********************************************************, when it was reported that Larry Ellison had acquired three million Tesla shares, Oracle has only gone up by (%.)
Oracle’s market cap is currently nearly twice that of Tesla though.
The future looks bright… or is it just the headlights on full?
The rally in Tesla’s shares has come amidst the introduction of new models and anexpansion into China
. Earlier this month, the electric car firm delivered the first vehicles made in China at its Shanghai Gigafactory. The plant is expected to produce various cars including the Model 3 and later even a Chinese-designed vehicles. Tesla is also expected to release the Model Y crossover later in summer.
The expected increase in revenue has made Tesla bulls increase their bets. Tesla bull and founder of ARK Invest Catherine Wood expects the price of the stock tosurge to $ 6, by .
Not everyone is convinced though. Last week when the stock was trading below $ (********************************************************************, Wall Street firmware CFRA indicated that thestock was fully valuedwhile warning investors of short-term pitfalls:
In our view, (Tesla) shares. now appear fully valued after a meteoric run-up since bottoming at $ / share last June and are not reflecting various near-term risks.
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This article was edited by Samburaj Das ********************************
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