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'A bailout for SolarCity': Here's what Wall Street is saying about Tesla's offer to buy the company

Akin Oyedele   

'A bailout for SolarCity': Here's what Wall Street is saying about Tesla's offer to buy the company
Transportation1 min read

elon musk lyndon rive

Mark Von Holden/AP

SolarCity Founder & CEO Lyndon Rive and SolarCity Chairman Elon Musk speak about the SolarCity IPO during the opening bell ceremony at that NASDAQ stock exchange on December 13, 2012 in Manhattan, New York.

Tesla's offer to buy SolarCity is better for SolarCity than it is for Tesla.

That's the general sentiment in much of the analyst commentary we've reviewed since Tuesday, when Tesla announced a bid for the solar-power company.

In a letter, Tesla's board offered to buy all outstanding shares of the SolarCity's stock at $26.50 to $28.50 per share, which represents a 21% to 30% premium. Tesla CEO Elon Musk is SolarCity's chairman.

What analysts said mirrored traders' reaction to the news. Tesla shares dropped by as much as 12%, while SolarCity soared 22%.

Even though both companies would compliment each other in the clean-energy space, analysts wonder whether Tesla should be pursuing this deal as it struggles with production delays and burns through cash.

Here's a roundup of some of the commentary:

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