Tesla Shares Reach New Heights Leaving Car Industry Giants in the Dust

by Stef Z on July 10, 2020

Elon Musk is having a blast while his car industry opponents are falling into despair after the skyrocketing of Tesla shares.

The 17-year old industry is going through a complete renaissance since coronavirus pandemic started, as more people are interested in investing in an electric car future.

The market value of Tesla ramped up 25% or $50 billion in a week, which reached the incredible $250 billion worth. This means that the market value of Tesla is now the same as the shared value of the car industry giants Ford Motor CO., Toyota Motors Corp., General Motors Co., and Fiat Chrysler Automobiles NV. A

Tesla share value hit the roof, and it's now worth $1,429.50. Investors who have bet against the stock, have lost nearly $18 billion this year, as Tesla shares are tripling the price.

Meanwhile, Mr. Musk is celebrating his success, and of course, taunting the short-sellers by announcing the sale of red satin garments under the name of "short shorts", at the price of $69,420 - symbolic numbers for a sexual position and marijuana. The well-known showman Twitter behavior of Mr. Musk led the short sellers to underestimate the fundamentals of the most powerful electric car industry in the world and turned out to be completely wrong.

The recent stock price jump, expulsed the short sellers out of the game, leaving only the most dogmatic ones on the market. Compared to last year, short-sell interest in Tesla dropped from 20% to 10% of its stock.

After reaching the incredible figures, Mr. Musk keeps mocking the Securities and Exchange Commission on the shorts, by twitting: "Will send some to the Shortseller Enrichment Commission to comfort them through these difficult times."

The automotive industry experts, however, are surprised by the sudden stock change, and some even say the Tesla shares are overvalued. David Whinston, a known automotive analyst for Morningstar Research Services commented: "I just can't justify the valuation even if you want to be very optimistic on their deliveries rising."

According to Mr. Whinston's analysis forecast, Tesla's shares are going to remain high, and a possible new rise can be expected until the end of this year.
Brian Johnson, another automotive analyst is predicting a $258 million full-year profit for Tesla by the end of the year, by delivering 435,000 vehicles, less than what Mr. Musk announced before the pandemic, a delivery of over 500,000 vehicles.

By forecasting this, he's basically warning bearish investors to stay put and "remain in the shelter of their caves." According to Mr. Johnson, the only way the shares can drop is if there's no high demand for the new Model Y compact sport utility car, announced for later this year.

Last year, Mr. Musk's opponents were correct when forecasting a slow down in Tesla deliveries. Early in 2019, the company had problems exporting the Model 3 compact car, so the stock fell at $178.98 a share by June last year.

As of April 2020, Tesla shares started to surge, leaving behind the 82-year old Japanese tradition of car making, Toyota.

At the moment, Tesla is the absolute #1 electric car industry in the world, with a promising rise until the end of this year.








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