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Tesla Stock Extends Slide, Falls Below $1 Trillion Value, As Investors Eye Musk Share Sale

Tesla's market value fell below $1 trillion Wednesday as the stock entered its third day in the red following Elon Musk's intention to dump 10% of his stake in the clean-energy carmaker.

Tesla  (TSLA) - Get Tesla Inc Report shares nudged lower again Wednesday despite a price target boost from Bank of America that could provide some support for a stock that has shed $200 billion in market value over the past two sessions.

Bank of America analyst John Murphy lifted his price target on the clean-energy carmaker by $200, to $1,200 per share, following a two-day slump triggered in part by founder and CEO Elon Musk's suggestion that he could sell as much as 10% of his stake in the group. 

Musk indicated his intention to sell in a weekend Twitter poll --  curiously coming just days after his brother, board member Kimbal Musk, filed to sell nearly a billion in shares himself -- that could lead to a Securities and Exchange Commission filing in the coming days. 

Musk could face a $5 billion tax bill if, as he has indicated, he abides by the result of the weekend poll and sells around $21 billion worth of Tesla shares somewhere in the region of last Friday's closing price of $1,222.09 each.

“Note, I do not take a cash salary or bonus from anywhere," Musk wrote on his verified Twitter account Saturday. "I only have stock, thus the only way for me to pay taxes personally is to sell stock.”

Tesla may also be taking a knock from investors both cashing out of the stock's recent share gains, which lifted it to an all-time high of $1,243.49 each on November 4, and diverting cash into today's Nasdaq listing for Rivian, the electric car maker backed by Amazon which raised nearly $12 billion from its aggressively-priced IPO last night. 

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Tesla shares were marked 0.75% lower in early trading Wednesday to change hands at $1,015.90 each after falling to as low as $987.32 each earlier in the session.

Short interest in Tesla remains elevated, however, following the group's passing of the $1 trillion market value threshold late last month, with recent data from S3 Partners pegging bets against Tesla at around $34.8 billion, or 3.65% of the stock's outstanding float.

Tesla passed the $1 trillion dollar on October 25, racing to a then-record high of just under $1,000 a share following reports of a $4.4 billion order from rental giant Hertz Global  (HTZZ) - Get Hertz Global Holdings Inc Report.

Tesla, which took over ten years as a public company to reach the iconic valuation, joins an elite list of only five other American companies that have ascended that peak: Microsoft MSFT, Apple  (AAPL) - Get Apple Inc. Report, Google parent Alphabet G (GOOGL) - Get Alphabet Inc. Class A Report, Facebook  (FB) - Get Meta Platforms Inc. Class A Report and Amazon  (AMZN) - Get, Inc. Report.

Tesla posted net income of just over $2 billion for the three months ending in September, alongside the strongest profit margins in the group's history -- 30.5% -- and record sales of $13.7 billion. The blowout figures followed another all-time high in third quarter deliveries, which rose 73.2% from last year to 241,300 units.

Non-GAAP earnings were pegged at $1.86 per share, up 135% from the same period last year and well ahead of the Street consensus forecast of $1.59 per share.