Tesla’s junk bonds are trading under water — and it could spell trouble for Elon Musk
Published: Nov 10, 2017
Tesla may struggle to get good terms if it attempts to issue more junk bonds, experts say
Tesla Inc. first-ever pure corporate bonds are trading under water, boding ill for the Silicon Valley car maker’s next attempt to tap capital markets.
Tesla TSLA, +0.12% sold $1.8 billion in the senior notes in August at a yield of 5.300%, at the height of excitement about the Model 3 and expectations the sedan’s production ramp would run as smoothly as Chief Executive Elon Musk had predicted.
That same month, Tesla shares rose 10% to mark their last monthly gain this year so far. The stock lost 4.2% in September and 2.8% in October.
The stock is down 9% so far in November, on the heels of a quarterly miss earlier in the month and news that the company has further pushed out its Model 3 production targets. ...
