Easy come, easy go, as shares of Twitter Inc. fell below where Elon Musk bought it, wiping out more than $1.1 billion in gains in four weeks.
The social-media company’s stock TWTR,
sank 6.0% in afternoon trading Tuesday, toward the lowest close since March 16. It has tumbled 31.1% since it closed at a high of $51.70 on April 25, which was the day Twitter agreed to be acquired by Musk for $54.20 a share.
A 13D filing with the Securities and Exchange Commission on April 5 showed that Musk, who is chief executive of Tesla Inc. TSLA,
and founder of SpaceX, bought his 73.12 million shares of Twitter, or 9.1% stake, at a weighted average price of $36.157, according to a MarketWatch analysis of the data.
That means at the current stock price, which is 1.5% below the purchase price, Musk would be losing $40.7 million on his investment. That compares with a $1.14 billion gain at the April 25 closing price of $51.70.
Keep in mind that the Twitter buyout deal comes with a $1 billion breakup fee, that could be paid by either Twitter or Musk, if the deal falls through.
Twitter’s stock has dropped 17.6% year to date, while Tesla shares TSLA,
have shed 40.8% and the S&P 500 index SPX,
has shed 17.5%.