Tesla Motors shares were initially offered to investors at $17. Three years later, the price was $90 per share. What was the compound annual return that Tesla investors owned over this period? Given that Tesla paid no dividends and was not expected to start paying dividends anytime soon, what method might ana- lysts have used to value the company's shares in 2013? The company sold 13.3 million shares in its IPO with a par value of $0.001 per share. How much paid- in capital did Tesla record on its balance sheet as a result of the IPO? Do you think that the highly favorable Consumer Reports review of the Model S boosted Tesla's stock primarily because the review reduced the company's risk or because it boosted expected cash flowe

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Tesla Motors shares were initially offered to investors at $17. Three years later,
the price was $90 per share. What was the compound annual return that Tesla
investors owned over this period? Given that Tesla paid no dividends and was
not expected to start paying dividends anytime soon, what method might ana-
lysts have used to value the company's shares in 2013? The company sold 13.3
million shares in its IPO with a par value of $0.001 per share. How much paid-
in capital did Tesla record on its balance sheet as a result of the IPO? Do you
think that the highly favorable Consumer Reports review of the Model S
boosted Tesla's stock primarily because the review reduced the company's risk
or because it boosted expected cash flows?
Transcribed Image Text:Opener-in-Review Tesla Motors shares were initially offered to investors at $17. Three years later, the price was $90 per share. What was the compound annual return that Tesla investors owned over this period? Given that Tesla paid no dividends and was not expected to start paying dividends anytime soon, what method might ana- lysts have used to value the company's shares in 2013? The company sold 13.3 million shares in its IPO with a par value of $0.001 per share. How much paid- in capital did Tesla record on its balance sheet as a result of the IPO? Do you think that the highly favorable Consumer Reports review of the Model S boosted Tesla's stock primarily because the review reduced the company's risk or because it boosted expected cash flows?
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