Is Musk's Big Payday Make-or-Break for Tesla's Share Price?
The Tesla (NASDAQ: TSLA) share price has risen ahead of the company's annual shareholder meeting on Thursday, 6 November. Central to the meeting is CEO Elon Musk’s proposed pay package, valued at up to $1 trillion.
The discussion isn't only about the payout itself, but also concerns that Musk might leave if the payment plan is rejected. He emphasizes his desire to maintain control:
[translate:«My fundamental concern … if I go ahead and build this enormous robot army, can I just be ousted at some point in the future?»]
This package is primarily stock-based, becoming valuable only if Musk achieves ambitious performance targets over the next decade. Success would mean Tesla’s market capitalization rising to $8.5 trillion, which is more than five and a half times its current value of $1.5 trillion.
Several shareholders are supportive, believing the potential rise in Tesla's share price justifies the package. Notably, Ark Invest CEO Cathie Wood has set a $2,600 price target for Tesla by 2029, aligning closely with the predicted market cap.
However, there is opposition from some major investors, including Norway’s sovereign wealth fund, which owns 1.2% of Tesla — or as Musk now calls it, the robotics developer.
Summary: Elon Musk's $1 trillion pay package hinges on ambitious Tesla growth targets; if met, it could vastly increase the company's market value, stirring both support and opposition among investors.
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