4 ms·
Because they need cash, probably
by notatoad 7y ago
Because they need cash, probably
- ethagknight 7y agoYou can always find debt for profitability in the energy markets, and this seems pretty low risk as energy investments go.
- notatoad 7y agoBut you can only take on so much debt as a company, regardless of market, and telsa is kinda already stretching that limit (or at least they are according to HN comments)
- bduerst 7y agoThey are. Tesla is debt leveraged to hell which is why they're saying they're going to raise another $2B in cash from equity and bond sales to pay some of it off. Tesla needs cash, and lots of it.
- astrodust 7y agoDebt hurts your fundamentals and hurts your stock price. Cash helps your stock price. If you're concerned about stock price, sell for cash.
- gingabriska 7y agoIt depend on how you use the debt. If are able to make slightly less ROI (due to cost of capital, cost of servicing debt) at larger scale, it's worth having debt and will have positive effect on stock price. The relationship is not as simple as you claim.
- bduerst 7y agoTrue, but we're not talking about an anonymous company in a vaccuum here, but Tesla, which already has plenty of debt.
- rcMgD2BwE72F 7y agoNo. They are free cash flow positive, and by $600+ million per quarter already.
- Gustomaximus 7y agoAre they? https://finance.yahoo.com/quote/TSLA/cash-flow?p=TSLA https://finance.yahoo.com/quote/TSLA/cash-flow?p=TSLA