As Tesla Motors Inc. expanded its stock offering, its shares had increased by almost 3%. The electric-car maker is being led by CEO Elon Musk. For the day, Tesla grew 2.8% to close at $29.28. In a regulatory filing, the company said that it predicts that it will sell 6.93 million additional shares at $28.25 each, an increase of 2.58 million from what it reported in a Sept. 25 filing.
The earlier filing didn't list a price. Tesla said that it estimates that it will get net proceeds of $192.7 million, or $221.6 million if the underwriter, Goldman Sachs Group Inc., exercises its option to buy more shares in full. Musk had lowered the output forecast for the Model S sedan. He said that he will buy up to 35,398 shares for around $1 million.
Alan Baum, principal of auto-industry forecaster Baum & Associates in suburban Detroit, said that the stock is being supported by the quality and reviews of the Model S, a multiple stage product plan beyond the Model S and Model X, and the quality of the operation. Tesla anticipates the delivery of 200 to 225 Model S cars in the third quarter and 2,500 to 3,000 in the fourth quarter.
Tesla made a previous prediction of 5,000 Model S deliveries this year. Tesla is relying on the demand for the Model S, which is priced from $57,400, to support the automaker in earning its profit for the first quarter. The Model X is a sport-utility vehicle targeted for 2014.