Tesla shares rise above $500 for the first time ever
Tesla shares rise above $500 for the first time EVER to leave Elon Musk’s electric car firm worth $91BILLION – more than the combined value of GM and Ford
- Company’s shares sit at $518, boosted Tesla up to a market value of $91billion
- Tesla’s share jump on Monday is being attributed to Oppenheimer & Co analyst Colin Rusch, who raised his price target on the Tesla stock from $385 to $612
- But Tesla’s market value still trails Toyota Motor Corp and Volkswagen AG
- Toyota Motor Corp is valued at $227.90bn while Volkswagen sat at $98.65billion
Tesla shares soared above $500 for the first time on Monday, just a week after Elon Musk’s company became the most valuable US car maker of all time.
Last week, Tesla closed with a market value of $81.39billion, surpassing Ford Motor’s peak of $80.81billion that was set in 1999.
Today, the company’s shares, which sit at $518, boosted the electric car maker up to a market value of $91billion, which is more than the combined value of General Motors and Ford.
GM has a market value of $50billion and Ford’s market value is $36billion, bringing the total to about $86billion, a few billion dollars short of Tesla’s.
Tesla’s share jump on Monday is being attributed to Oppenheimer & Co analyst Colin Rusch, who raised his price target on the Tesla stock from $385 to $612.
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Tesla shares soared above $500 for the first time on Monday, just a week after the company became the most valuable US car maker of all time. CEO Elon Musk is seen next to the Roadster 2 in November 2017
Today, the company’s shares, which sit at $519, boosted the electric car maker up to a market value of $91billion, which is more than the combined value of General Motors and Ford
Last week, Tesla closed with a market value of $81.39billion, surpassing Ford Motor’s peak of $80.81billion that was set in 1999
China also announced that the country will not make significant cuts to subsidies for new energy vehicles this year.
That revelation may have also contributed to Tesla’s boost.
Miao Wei, China’s minister for industry and information technology (MIIT), told a forum that the country would not cut subsidies for new energy vehicles (NEV) again in July, an approach which was cheered by vehicle makers.
Tesla’s market value still trails Toyota Motor Corp and Volkswagen AG. Toyota Motor Corp is valued at $229billion while Volkswagen sat at $98.65billion.
But Tesla is currently the sales leader in the US, according to the latest data compiled by the Edison Electric Institute (EEI), an association that represents all of the country’s investor-owned electric companies.
The company also leads with the top selling model, its Model 3.
While there are almost 1.2 million electric cars on the road, according to EEI, the segment still only represents 1.8 per cent of the total number of cars sold in the US market.
Monday’s increase for Tesla comes just three months after the company’s shares plummeted.
Monday’s increase for Tesla comes just three months after the company’s shares plummeted (depicted above)
Tesla design chief Franz von Holshausen tried to prove the glass was ‘shatterproof’ by throwing a heavy metal ball at close range – but the glass broke on both attempts. Tesla shares fell more than six per cent in November following the demonstration (pictured)
Tesla shares fell more than six per cent in November after the ‘armored glass’ windows on its new electric pickup truck shattered during a demonstration.
The sharp drop wiped $768million off Elon Musk’s estimated $23.6billion fortune at the time. Musk is worth $27.8billion now, according to Forbes.
During the embarrassing moment, the CEO was heard muttering ‘oh my f***ing God’ as the glass smashed.
In the much-anticipated unveiling to cheering fans, the Tesla boss had taken aim at the design, power and durability of mainstream trucks, only to be shaken when his boast about his new vehicle’s windows backfired.
The company’s shares fell to $333.41 at the time.
Tesla then had its biggest trading day ever on December 18, 2019, when the stock hit $392.50, a jump of 4.3 per cent as sources said the company was exploring a 20 per cent price cut for its Model 3 sedan to compete with rivals.
Earlier this month, the company started delivering China-made Model 3 sedans from its $2billion Shanghai plant.
But despite Tesla’s climb, short sellers are still skeptical.
Tesla tops the list in US sales of all electric vehicles, according to the latest data compiled by the Edison Electric Institute
Tesla, the front-runner in electric vehicle sales in the US, also has the best-selling vehicle, its Model 3, according to EEI
However, while there are almost 1.2 million electric cars on the road, according to EEI, the segment still only represents 1.8 per cent of the total number of cars sold in the US
Tesla’s short sellers have lost a stunning $8.4billion over the last seven months as the electronic car manufacturer’s stock continues to beat investor expectations.
Short positions on Tesla shares suffered more losses than on any other company, according to S3 Partners, a financial analytics firm.
In the first two trading days of 2020, short sellers lost more than $700million.
About 36 per cent of shares were being sold short in May, however many Tesla short holders are still holding onto to their stocks, adamant that Tesla shares will plunge.
Musk has been an outspoken critic of short sellers, saying they deliberately try to hurt the company by driving down shares.
Last week, Musk delivered a speech at the delivery ceremony of the first batch of Shanghai made Tesla Model 3 sedans in Shanghai, China. Ten customers became the first owners of the electric cars beyond the Tesla staff
In 2018 Musk deliberated making Tesla a private company just to stop dealing with shorts.
He said their ‘negative propaganda’ was a reason to get off the public market and that being a public company creates ‘perverse incentives for people to try to harm what we’re all trying to achieve’.
Timeline: Tesla, from struggling startup to most-valuable US car maker
2003 – Founded as Tesla Motors by engineers Martin Eberhard and Marc Tarpenning
2004 – Elon Musk, a PayPal co-founder, engineer and technology entrepreneur who also started aerospace manufacturer SpaceX, along with J.B. Straubel and Ian Wright join Tesla as co-founders
2008 – The Roadster, the company’s flagship, all-electric car, is introduced at a price of $109,000 after federal tax cuts, and is considered a luxury item as the company. Investors pour more money into Tesla while a financially-strapped Musk is saved by a $1.6 billion NASA contract awarded to SpaceX
2009 – The Model S is unveiled as the company’s second production vehicle
2010 – Tesla pays $42 million to purchase an old vehicle production plant in California and goes public the same year at $17 per share
2012 – Tesla unveils a mid-size SUV know as the Model X as it begins selling Model S for $75,000
2014 – Tesla builds its ‘Gigafactory 1,’ in Sparks, Nevada, to build battery packs for its vehicles
2018 – Musk tweets he secured funding to take Tesla private at $420 a share, a substantial premium at the time over the company’s stock price, when he actually hadn’t and Tesla agrees to pay $20 million to settle claims it had not properly policed the co-founder’s social media posts. Meanwhile, unsold Tesla vehicles are seen parked in lots around the country
2020 – Tesla’s new plant in Shanghai promises to ramp up production of its new $35,000 Model 3 and after the company delivered 112,000 vehicles in the fourth quarter, beating expectations
But Musk got himself into hot water with federal regulators when he tweeted that same year that he had secured the funding to take Tesla private at $420 a share – a substantial premium over the company’s stock price at the time – when he did not.
That tweet, in August 2018, sent Tesla’s stock on a wild ride. The US Securities and Exchange Commission stepped in and charged that the post hurt investors who bought the stock after the tweet but before they had accurate information.
At the time, Tesla shares dropped 4 per cent to $311.04.
Tesla, in an agreement with the SEC, paid $20million to settle claims it had not properly policed Musk’s social media posts.
The company delivered approximately 367,500 vehicles during all of 2019, just meeting the low end of its target to deliver 360,000 to 400,000 vehicles.
Tesla said it demonstrated a production run-rate capability of more than 3,000 units per week at the Shanghai factory.
However, short holders still expect Tesla to be eventually overtaken by more established car companies such as General Motors, Ford and BMW entering the electric car industry.
‘We think questions remain about first half 2020 results and gross margin sustainability; we point out that Tesla is already lowering prices in China and faces a flood of (electric vehicle) competition in the US, with at least 25 new models debuting this year,’ CFRA analyst Garrett Nelson wrote in a client note.
Earlier this month, Tesla reported that it delivered China-made Model 3s to 10 customers from the public.
And last Monday, the company handed the very first batch of the sedans to 15 employees who had placed orders.
The 48-year-old Musk, who’s also had to contend with the challenges of getting his SpaceX aerospace company off the ground, as well as three divorces, including his split, remarriage, and second split with Talulah Riley, didn’t hide his satisfaction over finally getting the Tesla Model 3 officially launched.
Social media in China was abuzz with images and video of Musk celebrating with a unique disco dance routine in his $2billion ‘Gigafactory’ in Shanghai – exactly one year after construction of the massive plant began.
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