Investors greet Tesla IPO with open arms 07/20/2010
Electric car company Tesla has hit the ground running, as eager investors snapped up the company's initial public offering with enthusiasm.
Tesla raised $226.1 million from the IPO, selling 13,300,000 shares at $17 a piece. When the stock reached public trading status, investors boosted the price even higher, with the stock soaring 40 percent on the first day and closing up $6.89. On the second day of trading, the stock ballooned even more, reaching the $30 mark before settling down around $25.
The electric car company was the first car company to go public since Ford in 1956, and investors showed their support with their checkbooks. The launch has been considered highly successful, with its 40 percent first-day jump the second highest for an IPO this year.
Tesla previously announced that it would use the funding from the IPO to develop its first sedan, the Model S. The company's first offering, the two-seat Roadster, sells for about $100,000. While investors caution that the company has yet to turn a profit, CEO Elon Musk has countered by saying that the company would be profitable had it only opted to sell the Roadster and not expand its business into other offerings.