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Insider Weekends: Musk Sells $8.52 Billion Of Tesla To Fund Twitter Purchase

May 02, 2022 4:10 PM ETTesla, Inc. (TSLA), TWTRABNB42 Comments


  • Insiders purchased 11 times more stock last week than they purchased in the week prior.
  • Musk sold $8.52 billion of Tesla to fund his acquisition of Twitter.
  • Four different insiders of Warner Bros. Discovery purchased shares on the open market, including the CEO and CFO.
  • Looking for more investing ideas like this one? Get them exclusively at Inside Arbitrage. Learn More »
Tesla Debuts Its New Crossover SUV Model, Tesla X

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In a month where we experienced the worst monthly drop in the Nasdaq since 2008 and where the big tech companies that were holding up the indexes also dropped, insiders stepped up as we expected to buy a significant amount of

Insiders Sell For Various Reasons But Only Buy For One Reason, They Expect The Stock To Go Up.

This is especially true for insiders of recent spinoffs. We do the hard work for you by combing through hundreds of insider purchases each year to find the best opportunities. Insiders sometimes buy to "signal" the market and make mistakes because of their myopic focus on their company/industry. We cut through the noise and use insider buying as an idea discovery tool.

Beyond insider buying, Inside Arbitrage also provides ideas and tools related to buybacks, spinoffs, SPACs and merger arbitrage. Click here to learn more.

This article was written by

Asif Suria profile picture

Asif Suria is an entrepreneur and investor with a professional background in technology and a focus on event driven strategies including: merger arbitrage, spinoffs, (legal) insider trading, buybacks and SPACs. Asif has been actively investing for over 20 years and sharing his ideas for the past 10.

He is the leader of the investing group Inside Arbitrage where he shares investment ideas rarely found in mainstream financial press. Inside Arbitrage provides access to six different event-driven strategies to expand your investing toolbox, special situations focused tools, qualitative writeups of ideas through weekly articles, and a comprehensive monthly newsletter. Learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of RKT, LGF.A either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: I hold long positions in Rocket Companies (RKT) and Lions Gate Entertainment (LGF.A). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (42)

EliasMouawad profile picture
Nice article. I still believe SNAP is a great buy. Just seven months ago, it was trading as high as $83
Doc 224899 profile picture
It's good to be King.

Musk is King.
Tdot profile picture
Emperor with no clothes.

Musk gets high one day and "rage buys" Twitter out of anger over "censorship" claiming "free speech" is needed. Suddenly comes off the high and realizes he has no money to buy Twitter, sells all the Tesla shares he legally can in order to raise some seed cash, leverages all of his remaining shares to raise more cash (and those shares against potential margin calls if Tesla shares fall), still doesn't have enough cash, and thus reaches out to other rich friends and investors to help him raise billions more in cash. Still billions short on cash. Decides it was all a huge massive drunken mistake, and announces that he will take Twitter public again as an IPO after he finishes taking it private.

That's the Musky way.
Real007 profile picture
They're barely monetizing today and with that massive DEBT BOMB coming how on earth do they ever plan to make payments on it ??

Not happening.
Asif Suria profile picture
@Real007 Are you referring to Warner Bros. Discovery?
Doc 224899 profile picture
@Asif Suria @Real007
....and Disney?
Real007 profile picture
@Asif Suria Musk/TWTR -- they can't service the new debt post takeover.
First paragraph, first sentence, first word, was the word meant to be ‘Investors’ rather than ‘Insiders?’ My sense is the former would be preferable. I’m not being a smart a**, I’d sincerely like to know. Please explain. Btw, a fascinating article. Thanks.
Asif Suria profile picture
@Jwjrwjr It was actually insiders. Significantly stepped up their purchases. The pace so far this week is also high.
@Asif Suria that makes sense. Thanks.
Some people in the US say CEOs should stay out of politics but those same people cheer Musk making political statements and posting opinions on Twitter?

Just slightly hypocritical
they don't see it. Their nose is buried too far up Elon's ass.
I still think Musk is not buying Twitter. Lots of people believe he made himself an excuse to sell * billion of Tesla at a high price and is willing to pay capital gains and the billion dollar penalty if he doesn't acquire Twitter to do so. Why would anybody want Twitter anyway.
@nuttyoptometrist he could have sold the stock without putting a bid on Twitter and saved the Billion dollar penalty.
That's just silly wasting such a large chunk of the sale, when you could have sold them anyway.
Asif Suria profile picture
@nuttyoptometrist He does not strike me like a person willing to give up $1 billion on a termination fee just because he needed an excuse to sell stock. He already sold a lot late last year and most founders/CEOs sell a lot on a consistent basis to diversify.
No he couldn't. At least and not lose millions of followers. He has said many times, he wasn't selling TSLA, and now it is a simple exercise to part with billions. He already lied about the tax sales, because he also "donated" $6 billion to charity, but no one knows where it went, which reduced his tax liability tremendously, but the followers are so blind, they said, look he is donating billions, but it was stock, and most likely went to himself or a charity that he controls.

The naivete of Tesla fans is strong.
cdgingrich profile picture
Thank you, Asif.
Asif Suria profile picture
@cdgingrich You are welcome. Thank you as always for reading.
Bright spot profile picture
Watch Twitter become the Tesla standard for communications. All while attached to the SpaceX internet satellites. Could be a smart thing with subscriptions to follow.
@Bright spot
why would an app or website be tied specifically to SpaceX? What does that even mean?
Maxed Out Mama profile picture
@eugene_ That someone has no understanding of how the internet works.
@Maxed Out Mama
It must be on some right wing weirdo page. I have seen other people claiming the same exact thing. Maybe, @Bright spot is a bot just like the others who post the same weird statement.
eeeW profile picture
musk is over his head on his whim to spend $44B on an app
@eeeW Musk has a good track with making and the selling "apps" since when he was in his 20s. I would take his side on anything in the software business.
EV_supporter profile picture

I agree. If he can do well with car business and rocket business, watch out when he gets into software business, especially platform software. I think Twitter will become a trillion dollar company before SpaceX and Boring.
Musk’s sales were smart business. Trading in high flying Tesla for broken Twitter is smart.
Twitter will be fixed and brought back to the public in 2-3 years.
EV_supporter profile picture

It must be painful to sell TSLA at this price. I'm pretty sure Elon understands TSLA is very likely to get another 10~20X.
Asif Suria profile picture
@EV_supporter He was also a big seller late last year along with his brother. At some point if you have so much of your net worth in one position, it makes sense to diversify. seekingalpha.com/...
EV_supporter profile picture
@Asif Suria

Last year Elon sold stocks to pay tax - exercising stock options.
Gordonr profile picture
And Tesla went up!
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