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Tesla to sell $5 billion worth of stock as shares continue to rally

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Tesla on Tuesday revealed plans to take advantage of its meteoric stock rise by raising up to $5 billion through a program to sell more shares of the popular electric vehicle company.

Wall Street’s main brokerages, including Goldman Sachs, Bank of America and Morgan Stanley, will serve as sales agents for the stock selling program, which represents less than 1 percent of Tesla’s $464 billion market capitalization.

Tesla shares briefly shot up as much as 3 percent on the news in pre-market trading, before settling down to open the day up 0.6 percent.

“We believe this is the smart move at the right time for Musk & Co.,” Wedbush analyst Dan Ives said in a research note, lauding investors’ strong appetite “to play the transformational EV trend through pure play Tesla over the coming years.”

Tesla’s announcement arrives a day after the company’s 5-for-1 stock split took effect, bringing the price of a share of the electric automaker down to just under $500 from its previous price of $2,500.

Tesla shares have skyrocketed more than 70 percent since it announced its plans for a stock split earlier this month.

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