Update — Tesla: Elon Musk Share Sales and Options Exercised

This is a continuation from the previous article (see end for link).

With Musk continuing to sell shares and exercise options this update summarizes his sell/exercise activity to date, analyzes tax implications and provides an overview of impact on share price.

Summary of sales & exercises from SEC filings (assumption that 10% of his shares was 17.05M):

Total Shares Sold and Options Exercised to Date (12Dec21)

Breakdown of Shares Sold and Options Exercised:

Shares Sold by Date with Price Analysis & Tax Implications (long term tax rate of 23.72% applied)
Options Exercised and Tax Implications (tax rate of 53% applied, see explanation in linked article)

Tax Situation and Impact on Future Sales:
Total tax owed (sales + options exercised): $9,861,741,800

Total proceeds minus taxes owed= $11,040,930,310.25-$9,861,741,800 = $1,458,892,025.38

Forward looking:
Assuming Musk will exercise remaining options this year (he likely does not want to risk a higher tax next year). The chart below shows the impact of different share prices on how many shares are required for tax and how much leftover $ he would have if he sold all of his 10%. The # of shares required is the minimum we should expect Musk to sell in the next 19 days (13 trading days).

Example of the above, assumption — average sale share price per option = $1074.02. Tax implications would be another $5,712,043,824.77. Subtracting the excess capital he has already generates → $4,253,151,799.39 is owed. Therefore, Musk must generate additional proceeds of $5,261,999,406.2. Assuming the prior average sale price of $1074.02; roughly another 4,899,353 shares need to be sold. This can be considered the minimum required to meet debt obligations.

Utilizing the average of 4,899,353 and 13 trading days Musk would at a minimum have to sell an average of 376,873.32 shares per day (this well within his sales history). Considering the original 10% promise that average rises to 536,747.54 per day.

Share Sales and Tesla Price Behavior:

The chart below depicts all of the sales (in gray) on the day that musk sold as well as the price high and low of Tesla.

5 Minute Intra-Day Price action of Tesla on Each Day when Musk sold (tan is outside of normal trading hours):

November, 8th, 2021
November 9th, 2021
November 10th, 2021
November 11th, 2021
November 12th, 2021
November 15th, 2021
November 16th, 2021
November 23rd, 2021
December 2nd, 2021
December 9th, 2021

Background (see for assumptions): ‘Why Elon Musk Will Sell 10% of His Tesla Shares”

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