Tesla Analyst Believes Musk Will Get $56B Pay Package ‘One Way Or Another’ Despite Delaware Court Ruling: Retail Stays Optimistic
By Stocktwits Inc | First Published Dec 3, 2024, 10:47 PM ISTWedbush analyst Daniel Ives remains optimistic about the outcome, predicting that the case will eventually be resolved in Musk’s favor, potentially reaching the Supreme Court.
Shares of Tesla, Inc. dropped nearly 2% Tuesday afternoon, after two consecutive sessions of gains.
The dip follows a legal setback for CEO Elon Musk as a Delaware judge yet again rejected his record-breaking $56 billion compensation package despite approval from Tesla shareholders in June.
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Delaware Chancery Court Judge Kathaleen McCormick upheld her January ruling, which found that Tesla’s board had been unduly influenced by Musk when it approved the pay plan in 2018.
The ruling stemmed from a lawsuit filed by a retail investor, and it has earlier caused concerns that Musk could leave Tesla to focus on his other ventures, including xAI.
However, Wedbush analyst Daniel Ives remains optimistic about the outcome, predicting that the case will eventually be resolved in Musk’s favor, potentially reaching the Supreme Court.
“This is just the latest round in this UFC battle between Tesla and the Delaware Courts with much more action ahead on the appeals process,” he wrote in a note on Tuesday.
Ives argued that “Tesla and Musk will fight this tooth and nail,” and ultimately, the company’s board will secure Musk’s pay package to ensure his continued leadership through at least 2030.
“Musk is Tesla and Tesla is Musk. One way or another the Board is getting Musk his pay package (and another long term one for the next decade),” he added.
“We also believe this case could be the catalyst for more public companies to leave the state of Delaware for their corporation status.”
Wedbush maintained an ‘Outperform’ rating on Tesla with a price target of $400.
Despite the latest legal hurdles, retail sentiment surrounding Tesla remained ‘bullish’ late on Tuesday morning, with a significant uptick in message volume on Stocktwits.
TSLA was among the top 10 most active symbols on Stocktwits on Tuesday morning following the news.
Retail chatter has surged by nearly 740% over the past month, particularly after the U.S. Presidential election results.
Many investors are optimistic that Musk’s ties to President-elect Donald Trump could benefit Tesla, especially in areas such as self-driving technology.
Separately, Tesla on Monday reportedly told employees on its Cybertruck production line to take the next three days off, although the reason remains unclear.
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