Tesla is now worth less than it was before Elon Musk's $420 tweet
- Tesla surged more than 10% Tuesday after Elon Musk said he was considering taking the company private.
- However a lack of more information and a reported investigation by federal regulators have wiped out the gains.
- Follow Tesla's stock price in real-time here.
Shares of Tesla have rolled over and given up their more than 10% gains from Tuesday when CEO Elon Musk tweeted that he was considering taking the company private at $420 share.
The stock declined more than 6% Thursday, falling as low as $346.49. When Musk's cryptic tweet sent shockwaves through markets at 12:48 p.m. ET on Tuesday, the stock was worth $358.Musk said funding was secured, but offered no details as to which investor may be willing to cough up the billions needed to take Tesla off public stock exchanges. Those lingering questions, paired with a report from The Wall Street Journal on Wednesday that said the Securities and Exchange Commission (SEC) was investigating the tweet, only further dragged down the price.
Bloomberg on Thursday afternoon conformed the paper's report, and said that the federal securities regulator had been looking into Tesla's public statements before the tweet. That investigations is now "intensifying," it said.
Legal experts told Business Insider that if financing had not actually been secured at the time of his tweet - which would count as a material statement under SEC rules - the billionaire likely broke federal laws. The SEC's requirements say a company must file an official disclosure within four days of a major event. Those events are generally defined as an acquisition, leadership change, or something in regards to the company's financial situation.
In an email to employees which was later published on Tesla's website, Musk gave a few more details on the plan, leading with the fact that a final decision has not been made.
Thursday's declines also wipe out the smaller gains that came just before Musk's tweet, when the Financial Times reported that Saudi Arabia's public investment fund had invested $2 billion in the company.
Tesla is up nearly 13% since the beginning of the year.