Billionaire Liu Quoquan, who is the third largest individual shareholder in Tesla, called Electric car makerto announce a $15 billion share buyback after successive declines in the share price.
In a tweet referring to Tesla’s senior director of investor relations, Martin Vicha, Cogoan wrote that the company should immediately announce a plan to buy back $5 billion of Tesla stock this year, and $10 billion next year.
He added that Tesla should use free cash flow to finance the buyback, as it would not affect its current cash reserves of $18 billion, according to CNBC, which was seen by Al Arabiya.net.
Tesla shares closed down more than 6% on Wednesday amid widespread market selling. The company’s stock is down more than 30% this year.
Companies resort to buying back their shares to try to return the capital to shareholders through the open market, to support share prices and to employ part of the surplus cash in their balance sheet.
Buybacks jumped to a record $850 billion in 2021, with Apple at the top, followed by Alphabet, and Meta (Facebook’s parent company). Alphabet also announced another $70 billion share buyback last month.
Cogwan earned billions of dollars in profits from betting on Tesla shares during the Corona pandemic, as he sold his shares in companies such as Baidu, Nvidia, China Mobile and Neo.
Wedbush analyst Dan Ives said Musk’s plan to buy Twitter was a “significant burden” on Tesla stock.