Hello, dear readers, this is our daily column “Elon Musk and His Tweets”. The events in January demonstrate that the Twitter account of the head of Tesla and SpaceX can already be regarded as some sort of a trampoline for stocks of public companies.
At the beginning of the month, a laconic Musk’s post provoked the growth of Signal Advance’s stocks by 6,350%. Yesterday, a similar thing happened to Etsy’s stocks. Let’s find out what’s going on.
Promotion in Twitter, fast and affordable
On January 26th, the eccentric billionaire made two publications on Twitter. “I kinda love Etsy. Bought a hand knit wool Marvin the Martian helm for my dog”, he wrote. More words, more details than in the tweet about Signal.
It seems to be nothing special but the stock price of the US online platform for selling handmade stuff, antiques, and rarities grew by 11.3% to 232.39 USD per stock.
However, it would be fair to note that the increase was short-term; yesterday, trades closed with a decline of 2.11%.
Here we go again
The increases in the stock prices of Etsy and signal Advance, provoked by Musk’s tweets, are not unique. In January, the CEO of Tesla posted a picture of a hero from the Idolmaster anime and video game. That very day, the stocks of the developer and creator of the game Bandai Namco in the Tokyo Stock Exchange leaped up by 4.4%.
The activity of the billionaire on Twitter impacts the stock price of his companies. For example, in May last year, he wrote that the stocks of the electric car producer are significantly overvalued, which dropped the stock price by 10% at once. However, a week after the publication, the stocks grew by almost 17%.
Interesting facts about Etsy
- The company was founded in 2015 by Robert Kalin, Chris Maguire, Haim Schoppik, and Jared Tarbell.
- In 2015, Etsy went to the NASDAQ exchange. The IPO brought 237 million USD to the marketplace, while its market price grew to 1.8 billion USD.
- According to CNBC, 2020 raised the stock price of Etsy by 313%, while 2021 that has just begun – by 17%. Thank you, COVID-19, and the lockdown!
- According to the company, the website now holds over 81 million goods; there are 70 million if active buyers and 4 million sellers registered.
- When this article was being prepared, there were 125 million stocks in circulation; the market capitalization of the company is 25.8 billion USD, and its stocks cost 204.41 USD each.
The stocks of Etsy, a US company doing online commerce, grew steeply by over 11% after the head of SpaceX wrote a simple tweet about it. This, again, demonstrates not only the impressive influence of Elon Musk’s opinion on investors but also the highest speculative activity in the market.
We can hardly be surprised by such events but we admit we are looking forward to new provocative tweets by the billionaire. We wonder which company will be the next one.