Are These Tesla Motors Inc. Stock Option Grants Giving Away Too Much?

A Fool takes a closer look at the car company’s Form 4 filings and finds answers in the footnotes.

Feb 1, 2014 at 3:01PM

How generous is Elon Musk? Plenty. He recently granted hundreds of thousands of Tesla Motors (NASDAQ:TSLA) stock options to a handful of the car company's senior executives. Yet it's a surprisingly good deal for shareholders, as Fool contributor Tim Beyers says in the following video.

You wouldn't know it from the size of the grants. Chief Technical Officer J. B. Straubel received 220,000 options to buy shares at a strike price of $139.34 at various points over the next decade. VP of production Gregory Reichow took home 65,000 options at the same strike price. CFO Deepak Ahuja and VP of worldwide sales and service Jerome Guillen split 100,000 more in options awards.

But there's also a catch: Tesla grants performance stock options, exercisable only when certain conditions are satisfied. What conditions? The footnotes in the various Form 4 disclosures aren't that specific. Even so, investors should take the grants as a bullish sign, Tim says, because it shows that Musk is fostering a culture that rewards outperformance, rather than time served in the same job.

Now it's your turn to weigh in. Would you have been as generous with Tesla's stock options grants? Why or why not? Please watch the video to get Tim's full take, and then leave a comment to let us know whether you would buy, sell, or short Tesla stock at current prices.

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Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Netflix at the time of publication. Check out Tim's web home and portfolio holdings, or connect with him on Google+Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool recommends and owns shares of Netflix and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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