It was in the mid 00s when Tesla produced its first electric car, a roadster based on the legendary Lotus cars, the Elise model. This car was beautiful, classic, very light, ideal to experiment on and transformed in electric. In January 2010 Tesla received a $465 million loan from the U.S. Department of Energy, which it repaid in 2013. Another milestone was on June 29 2010, when Tesla Motors launched its initial public offering (IPO) on NASDAQ, the first American car company to do so since the Ford Motor Company had its IPO in 1956. The following years Model S, X, 3, and Y were designed and produced, among other projects, and daughter companies that were created.
In June 10, amidst covid-19, the electric car maker’s market capitalization surpassed that of BMW, Daimler and VW combined (Tesla value was €165Bn, whereas the three German manufacturers’ combined value was €156Bn). Three weeks later, Tesla’s market capitalization surpassed that of Toyota (206Bn over 202Bn) to become “the world’s most valuable automaker by market capitalization”. (CNBC / Pippa Stevens)
In the same difficult period (July 2019 to June 2020), Tesla recorded four profitable quarters in a row for the first time, which made it eligible for inclusion in the S&P 500; it was announced on November 16, 2020, that it will occur prior to trading on December 21, 2020. This rocketed sky-high the company’s stock.
As a result, Elon Musk became the third richest man in the world surpassing Bill Gates, according to Forbes.
Investment experts claim the stock value will correct eventually, but Musk proved to be a man of his word. A controversial perhaps even eccentric figure, under the age of 50 who managed to build an empire offering high-tech pioneer products, leads the (electric) car industry. Of course the car giants will not give up the fight that easily, nor will they let Musk enjoy his victory for much longer if they can help it.
For the short-term players seems there is still room for improvement before the stock corrects. For the rest, it is a keeper, as Tesla is definitely a company worth monitoring for its long-term potential, innovation and know-how in an area that is the future: electric energy. It is a car company as much as it is a tech company and one of the stocks we have been watching closely, long before this spree occurred!
Images: Tesla Inc.,