Twitter closed over 27% higher after Elon Musk became its largest shareholder with 9.2% stake 🤨

Tuesday, 5th April 2022 by Gotrade

Apr 05, 2022

Hey Gotraders,

Elon Musk, CEO of Tesla (TSLA) is moving markets again. He used to move markets with his tweets. But guess what, he actually went out and BOUGHT shares of Twitter (TWTR).

That’s right, he has a 9.2% stake in the social media company, which makes him the largest shareholder. Even Jack Dorsey, Twitter's co-founder owns fewer shares than Musk. Dorsey owns just 2.6% of the company. Wow… Musk must REALLY LOVE Twitter!

How much did Musk pay for his stake in Twitter? Well, he did not disclose what he paid for the shares, but his stake was worth $2.9 billion as of the close of trading Friday, and nearly $4 billion after the spike yesterday.

How did the world find out about his stake? When a person or group of persons acquire a significant stake in a company - usually more than 5% of a voting class of its publicly traded securities - the SEC requires that they disclose the purchase. That’s pretty much how the world found out!

How did Twitter shares react? Twitter posted its best one-day gain since its IPO after Musk’s stake in the company hit the headlines! Shares closed up over 27%, and was also the best-performing and most actively traded stock in the S&P 500 yesterday.

Ok, so what’s next for Twitter? Investors are anticipating some changes to come their way soon. Musk already posted a tweet asking his audience if they would like an edit button on Twitter. Also, news just broke that Musk will be joining Twitter’s Board of Directors!

Why is this important? “I think he intends to go active and force change at Twitter… This is a shot across the bow at Twitter’s board and management team to start discussions” - Dan Ives, tech analyst at Wedbush Securities.
Let’s see what changes Musk brings about at Twitter!
Shares closed at $49.97, up 27.13% for the day.

📉 Starbucks suspends share buybacks ✋

Uh oh…. On Howard Schultz’s first day back as interim CEO, he went ahead & suspended the company’s share buyback program.

“Starting immediately, we are suspending our share repurchasing program.. This decision will allow us to invest more into our people and our stores - the only way to create long-term value for all stakeholders” - Howard Schultz, CEO of Starbucks.

Starbucks had reinstated its $20 billion share buyback program in Mid March. But thanks to Mr. Schultz, the program is now suspended.

He also goes on to say “Starbucks is facing new realities in a changing world… Specifically, pinched supply chains, the decimation caused by Covid, heightened tensions and political unrest, a racial reckoning, and a rising generation that seeks new accountability for business… The company can either choose to rise to this moment - or stand idle."

Shares of Starbucks closed at $88.09, down 3.72% for the day. Shares are down a further 1.44% in extended trading at the time of writing.

📈 Oil is up 4%🔺

The price of oil dipped below $100 last week as the U.S.and International Energy Agency members committed to releasing oil from their reserves. Well, that dip in oil prices didn’t last very long at all. Prices are back up over $100.

Prices are rallying due to the possibility of increased sanctions against Russia as news of civilian deaths in Ukraine comes to light. Russia is being accused of genocide, and war crimes.

At the time of writing, the price of West Texas Intermediate (WTI) futures - the benchmark for U.S. oil - is trading at around $104. Analysts are expecting the price of oil to retest the $130 level.

We have several energy stocks and ETFs on Gotrade. Check out our “Commodities” category!

Top movers & shakers 🎢

What else is making headline news 📰

Popular companies releasing earnings this week 💰

Wednesday: Exelon (EXC), Levi Strauss (LEVI), Tilray (TLRY)

Thursday: Constellation Brands (STZ), Conagra (CAG), Lamb Weston (LW)

A company’s market value may fluctuate considerably around the time that the earnings report is expected to be published. Stock prices may rise or fall according to analysts' speculative estimates, released prior to the actual earnings announcement.

The earnings season can be a time of great opportunity since better-than-expected figures could cause a company’s stock to greatly increase in value. Worse-than-expected results could have the opposite effect.

That’s all from us for now.

Signing out,

Gotrade Team

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The legal stuff 🤓

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