Billionaire Leo Coguan, After the stock price who claims to be Tesla’s third-largest single shareholder, has urged the automaker to announce a $15 billion share buyback as the company’s share price continues to fall.
In a tweet to Martin Viecha, After the stock price Tesla’s senior director of investor relations. Coguan said the company should announce soon that it plans to buy back $5 billion in Tesla shares this year and $10 billion next year. He added that Tesla should use its free cash flow to fund the purchase. That it would not affect its existing $18 billion cash reserves.
In a subsequent tweet, Coguan said Tesla’s free cash flow was $2.2 billion in the first quarter of this year. He added that he hopes it to grow to $8 billion this year and $17 billion next year after capital expenditures are factored in.
He said Tesla could invest in fully autonomous driving, Optimus bots. And a new factory while buying back its “undervalued stock.”
Tesla did not immediately respond to the news request for comment.
On Wednesday, Tesla shares fell more than 6% amid a broad market sell-off.
Share repurchases when a public company uses cash to buy its shares on the open market is a method companies use to try to return capital to shareholders. Those purchases rose to a record high of $850 billion in 2021. Apple bought more of its stock during the year than any other publicly-traded company, followed by Alphabet and then Meta. Alphabet announced a $70 billion buyback last month.
According to a Forbes report in October, Coggan “laid the groundwork” for Tesla at the start of the coronavirus pandemic. Which said he made billions from his long-standing relationship with the electric vehicle maker. After selling stakes in other companies, Kogan reportedly went all-in at Tesla, including Baidu, Nvidia, China Mobile, and Nio.
“I thought I was an Elon fanboy,” Coggan said. “I would say he’s the only person I respect on earth.