US President-elect Donald Trump and Elon Musk watch the launch of the sixth test flight of the SpaceX Starship rocket in Brownsville, Texas, on November 19, 2024.
Brandon Bell | Via Reuters
Tesla Stocks jumped to all-time highs on Wednesday, surpassing the previous record they reached in 2021, due to a post-election rally and Wall Street's growing enthusiasm for… Elon Musk Electric vehicle company.
The stock rose to an intraday high of $415, 50 cents higher than its previous peak, and was on track to close ahead of its highest close, which was $409.97 on November 4, 2021.
Tesla's market value has swelled by about 66% this year, with almost all of those gains made since then Donald Trump Winning the elections early last month. The stock's 38% rise in November marked its best monthly performance since January 2023 and the 10th best ever.
Musk spent $277 million on pro-Trump campaign efforts, according to Federal Election Commission filings, and turned his support of the Republican candidate into another full-time job before the election, financing a campaign. Swing state process to register voters and use his social media platform X to constantly promote his preferred candidate, often with misleading information.
The world's richest person, who has seen his net worth rise to more than $360 billion, is set to lead the Trump administration's “government efficiency department”, alongside Republican presidential candidate Vivek Ramaswamy.
His new role could give Musk power over federal agency budgets, hiring, and the ability to push for the repeal of inappropriate regulations. During a Tesla earnings call in October, Musk said he planned to use his influence with Trump to create a “federal approval process for self-driving vehicles.” Currently, approvals are done at the state level.
“The stock is responding to the Trump shock,” said Craig Irwin, analyst at Roth MKM. He told CNBC “Squawking in the Street” last week. Irwin had just raised his price target to $380 from $85, writing in a report that Musk's “genuine support for Trump would likely double the pool of Tesla enthusiasts and increase the credibility of the demand reversal.”
On Wednesday, analysts at Goldman Sachs boosted their price targets for Tesla stock, joining a group of companies that raised their price forecasts or ratings on the stock. “The market is taking a more forward-looking approach to Tesla, including regarding its AI opportunity,” Goldman Sachs analysts wrote.
Analysts at Morgan Stanley and Bank of America have also issued bullish reports recently.
Since Trump's victory, Musk has been accompanying the president-elect to meetings with world leaders, and has begun advising him and members of Congress on federal agencies, regulations and budget items that the billionaire would like to eliminate or significantly reduce.
Tesla's rise to a record high represents a dramatic turnaround from its performance to start the year. Company shares It fell by 29% in the first three months of 2024, the stock's worst quarter since the end of 2022 and the third-worst quarter since Tesla went public in 2010. At the time, investors were concerned about Tesla's core business, which reported Decreased revenue In the first quarter due in part to increased competition from China.
In it Third quarter earnings report In October, Tesla reported an 8% year-over-year revenue increase, slightly below estimates. However, the company reported better-than-expected earnings, and Musk said on the earnings call that his “best guess” was that “vehicle growth” would reach 20% to 30% next year, due to “low-cost vehicles” and “low-cost cars.” “The Coming of Self-Government.” These expectations came ahead of analysts' expectations.
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