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Yahoo Finance anchors discuss Tesla stock dropping after a report that it is being investigated by the SEC for solar panel defects.
JULIE HYMAN: Speaking of volatility, though, we've got to focus on some individual movers in this market. And let us start, actually, with Tesla here this morning, because just getting a report out from Reuters, before we came to air, that the company's solar panels are under SEC investigation. The stock was trading down by as much as 3% in pre-market trading. Now it's off by about 1.4%.
We don't have many details on this. It's not clear what exactly this investigation entails. But especially with Tesla at such lofty levels, it's sort of vulnerable here to any kind of headline risk, Brian Sozzi.
BRIAN SOZZI: Oh, absolutely. But let's keep in mind here, I mean, Tesla's stock is going to take its cue from the cars it sells and how much profitability they will be having over the next couple of quarters as a result of their increase in production. And there are better ways of doing things. I think the market has forgotten that Tesla even owns, or they went out and spent money on, SolarCity. I wouldn't say the market doesn't care less, because we are seeing the stock fall here.
But again, I think this is a stock-- very much is just going to move on the cars they sell and their financial statements accordingly.
BRIAN CHEUNG: Yeah. And to kind of jump in very quickly again, this reporting is coming from Reuters. It came just about an hour ago, so we're still kind of getting the developing details. But the Reuters report noting that this concerns them not properly notifying shareholders about the fire risks associated with their solar panel system.
So again, we'll see what the company has to say for their part. But it is interesting to kind of see the SEC trying to step in here. And obviously, the big hook that got their jurisdiction-- or got this case into their jurisdiction was not properly notifying their shareholders. But again, with the other emerging EVs, which we'll also talk about, I think, later in this block, there is a lot of these kind of open questions about to what degree certain types of technical problems, which are really not in the purview of the SEC, right-- I mean, what does the SEC know specifically about how solar panels work?
But whether or not they're disclosing these things, especially given that a lot of these EV makers, especially these more emerging ones that have gone public via SPAC are obligated to disclose these types of risks, which are very much also a financial risk to their shareholders as well. Very much going to be a running theme in the quarters to come.
JULIE HYMAN: Yeah. And this also reminds me, by the way, of that trial that just happened, right? There was a lawsuit-- investor lawsuit dealing with the Tesla acquisition of SolarCity and whether it was in the best interest of shareholders. So yes, it's a sort of a line item at this point, in terms of Tesla's financials. I guess it's more just a question of how upfront the company is being about its financials and about its products, and if this SEC investigation is going to that. I mean, it seems like Tesla is Teflon to some extent. But you know, you never know.
BRIAN SOZZI: Brian, aren't there solar panels on the SEC building? I know you can confirm that. You got it for me.
BRIAN CHEUNG: It's a nice building in DC. Yeah, it's possible. So maybe they have some experts. Yeah, you're right. You're right, Brian. I shouldn't write them off like that.