Tesla Stock Sold By Europe's Largest Pension Fund In Q3: 'We Had A Problem' With Musk Pay

Europe's largest pension fund sold out of its stake in electric vehicle company Tesla Inc TSLA during the third quarter, missing out on future gains and all-time highs hit after the 2024 election.

What Happened: Stichting Pensioenfonds ABP sold its entire stake in Tesla in the third quarter due to its thoughts on the $56 billion pay package for Tesla CEO Elon Musk, which shareholders approved in June 2024.

"We had a problem" with Musk's pay package, a fund spokesperson told Bloomberg Sunday.

While Musk's pay package was one of the main reasons for the sale, the fund spokesperson also said that costs, potential stock return and responsible investment requirements were reasons for the stock sale.

Dutch newspaper Het Financieele Dagblad first reported the Tesla stock sale by the pension fund and also cited poor working conditions from Tesla as a reason for the sale.

The stake was worth an estimated $585 million at the time of the sale, as reported by Bloomberg.

ABP voted against Musk's pay package shareholder proposal in June, saying it was "controversial and exceptionally high."

Shareholders approved the pay package in June, but the plan was rejected by a judge once again in December. Tesla has appealed the judge's decisions in the latest twist in the pay package saga.

Musk's pay package was worth $56 billion thanks to Tesla stock hitting all milestones set in the original pay compensation plan for the CEO.

Are you buying when the CEOs of the Magnificent 7 are selling?

• Stay in the know with our Insider Trades page — see when leaders like Mark Zuckerberg, Elon Musk, and Jensen Huang are offloading their own shares.

Why It's Important: The pay package for Musk has been an overhang on the Tesla story and potentially the stock. If the appeal does not see the pay package go through, Tesla will likely need to pass a similar pay package for Musk and the Board of Directors warned that a new plan could be more costly.

The sale by ABP came ahead of Tesla stock hitting all-time highs, levels reached after Donald Trump won the 2024 presidential election.

Tesla stock soared after the election and hit all-time highs in 2024, helping Musk's wealth hit the $400 billion level.

Tesla stock opened for trading at $201.02 on July 1 and closed at $261.63 on Sept. 30. During the quarter, Tesla stock traded between a low of $182.00 (Aug. 5) and a high of $265.60 (July 15).

Selling Tesla in the third quarter was likely costly for the pension fund, as the stock is currently up 45.7% to 112.7% from the low and high price in the third quarter, respectively, based on a price of $387.09 for shares at the time of writing.

Price Action: Tesla stock trades at $387.09 on Monday versus a 52-week trading range of $138.80 to $488.54. Tesla stock is up 76% over the last year.

Read Next:

• Tesla Stock ‘Well Positioned To Deliver Robust Multi-Year Growth’: Why Analyst Is Raising Price Target After Deliveries Miss

Image: Shutterstock