As one of the most-watched stocks in the market, any sort of developments that would normally fly under the radar at many companies don’t at Tesla (NASDAQ:TSLA). The electric vehicle (EV) maker continues to lead the way in terms of headline-making news. Today’s news that’s moving TSLA stock is tied to a key management shakeup at the firm.
Current CFO Zachary Kirkhorn will be stepping down from his long-time post. Notably, Kirkhorn has been at Tesla for 13 years and is among CEO Elon Musk’s most tenured and well-known executives. On previous earnings calls Musk did not attend, Kirkhorn was a “calm, steady presence” that many investors may be sad to see go. His resignation officially took place on Friday, with his replacement being named as Vaibhav Taneja. Kirkhorn plans on staying with the company until the end of the year to “support a seamless transition.”
Taneja is currently the head of accounting for Tesla, having previously held the role of corporate controller in 2018.
Let’s dive into what investors may want to make of this news.
TSLA Stock Dips on News of Executive Shakeup
Interestingly, the timing of Kirkhorn’s decision to step down has caught some investors off guard. Tesla is set to release its Cybertruck before the end of the year and is focused on fending off strong competition in the space. The EV firm has taken on an aggressive role in cutting prices to boost market share of late. Kirkhorn has been credited with keeping Tesla’s margins high (and expanding the company’s margins as it grew), something many thought wouldn’t be possible.
It’s unclear what the rationale for this move is, but 13 years at any company is a long tenure in this day and age and eons in the tech sector. It appears investors have settled down with the idea of Taneja taking the reins, with shares settling down from previous losses of around 3% to a dip of just 0.6% at the time of writing.
That said, whenever a CFO steps down, folks ask questions. Currently, Kirkhorn holds roughly 105,000 shares, valued at around $26 million. Whether he decides to hold his position or liquidate his vested stock remains to be seen. But be assured, investors will be watching closely.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
