Tesla Inc. shares slipped in early trading as investors absorbed the prospect of a new distraction for CEO Elon Musk.
Musk’s unsolicited $43 billion takeover bid to take Twitter Inc. private is the first time he has attempted to buy a fully formed company of that size. His previous enterprises, which also include SpaceX and the Boring Co., have largely been built from the ground up in his image.
Tesla shares fell 3.5 percent to $986.26 as of 10:38 a.m. New York time on Thursday. The stock has dropped about 5.7 percent since Musk revealed a stake in Twitter last week, more than double the decline in the broader S&P 500 Index over that time.
“As the CEO of a trillion-dollar company, Elon Musk should focus on Tesla and not waste time attempting to acquire and manage a $43 billion company,” said David Trainer, CEO of investment-research firm New Constructs, in an email.
Tesla faces “significant competition” as major automakers are catching up on innovation in EVs, Trainer said. Shareholders may be worried that Musk would be pulled away from operations if his Twitter bid is accepted. Musk controls product decisions at Tesla and plans to start production of the Cybertruck, Semi and next-generation Roadster next year.
