Can someone remind me why people think that Elon Musk is a great businessman? I am asking because of this:
Elon Musk’s X is now worth less than a quarter of its $44 billion purchase price, according to a new estimate from investor Fidelity.
The asset manager’s Blue Chip Growth Fund now values its stake in X, formerly known as Twitter, at approximately $4.19 million, based on newly released disclosures from Fidelity’s Blue Chip Growth Fund. The firm’s unit has reduced the value of its holding in X by a total of 78.7% as of August end.
For context, Fidelity had initially invested $19.66 million in X through the Blue Chip Fund, as per regulatory filings. This isn’t the first time Fidelity has cut the value of its holding in X. As of July’s end, Fidelity had valued its shares in X at about $5.5 million.
This 78.7% markdown implies that Fidelity is currently valuing X at about $9.4 billion overall. (TechCrunch’s assessment assumes that Fidelity’s investment in X was made at a $44 billion valuation. The acquisition was financed through a combination of equity and debt.)
Perhaps I am looking at this wrong. But if I buy a business and it is worth substantially less than what I bought it for, then that means that I really screwed up because the whole point is to make money rather than bleed money. Given that, you have to wonder how long before Elon taps out because he either has to put his own money into Twitter to keep it afloat, or he has to tap out and look like a loser by doing so.
Let’s see what he’s going to do as I suspect the clock is ticking.
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This entry was posted on September 30, 2024 at 3:04 pm and is filed under Commentary with tags Twitter. You can follow any responses to this entry through the RSS 2.0 feed.
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Fidelity Says That Twitter Is Worth Only 21% Of What Elon Musk Bought It For… What A Loser
Can someone remind me why people think that Elon Musk is a great businessman? I am asking because of this:
Elon Musk’s X is now worth less than a quarter of its $44 billion purchase price, according to a new estimate from investor Fidelity.
The asset manager’s Blue Chip Growth Fund now values its stake in X, formerly known as Twitter, at approximately $4.19 million, based on newly released disclosures from Fidelity’s Blue Chip Growth Fund. The firm’s unit has reduced the value of its holding in X by a total of 78.7% as of August end.
For context, Fidelity had initially invested $19.66 million in X through the Blue Chip Fund, as per regulatory filings. This isn’t the first time Fidelity has cut the value of its holding in X. As of July’s end, Fidelity had valued its shares in X at about $5.5 million.
This 78.7% markdown implies that Fidelity is currently valuing X at about $9.4 billion overall. (TechCrunch’s assessment assumes that Fidelity’s investment in X was made at a $44 billion valuation. The acquisition was financed through a combination of equity and debt.)
Perhaps I am looking at this wrong. But if I buy a business and it is worth substantially less than what I bought it for, then that means that I really screwed up because the whole point is to make money rather than bleed money. Given that, you have to wonder how long before Elon taps out because he either has to put his own money into Twitter to keep it afloat, or he has to tap out and look like a loser by doing so.
Let’s see what he’s going to do as I suspect the clock is ticking.
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This entry was posted on September 30, 2024 at 3:04 pm and is filed under Commentary with tags Twitter. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.