Tesla’s stock has been on a remarkable upward trajectory recently, according to a report by Emily Bary for MarketWatch. The electric vehicle giant’s shares have climbed for ten consecutive trading sessions, marking its longest winning streak in over a year. This impressive run has propelled Tesla’s stock to its highest closing price since last October.
The numbers behind this rally are staggering, as MarketWatch highlights. Over the course of these ten sessions, Tesla’s stock has surged by an astounding 43.7%. To put this into perspective, it’s the company’s strongest 10-day performance since early February 2023. On Tuesday alone, the stock rose 3.7%, outperforming most of its peers in the S&P 500.
Source: Google Finance
This recent surge represents a dramatic reversal of fortune for Tesla. For much of the first half of 2023, the company’s stock had been struggling, posting significant year-to-date losses. However, this winning streak has not only erased those losses but pushed Tesla into positive territory for the year, with a 5.6% gain. Despite this turnaround, it’s worth noting that Tesla still lags behind its fellow “Magnificent Seven” tech stocks in terms of year-to-date performance.
The scale of Tesla’s recent gains is put into perspective by MarketWatch’s reporting on the company’s market capitalization. Since the beginning of this winning streak, Tesla has added approximately $250 billion to its market value. To contextualize this growth, that increase alone exceeds the entire market capitalization of any other automaker except Toyota.
MarketWatch attributes part of Tesla’s momentum to its better-than-expected delivery numbers reported in early July. However, the article also presents a balanced view from analysts. Oppenheimer analyst Colin Rusch, while acknowledging Tesla’s execution on “critical elements of keeping the business healthy,” maintains a cautious stance. Rusch points out that while bulls might focus on Tesla’s energy storage sales and potential future growth drivers, bears are likely to scrutinize the company’s margins and its challenges in monetizing its Full Self-Driving feature.
Rusch believes that the future trajectory of Tesla’s stock will largely depend on the perceived value of its FSD/AI platform. This suggests that while Tesla’s recent performance has been impressive, the road ahead may still hold challenges and uncertainties for the electric vehicle pioneer.
According to a report by Alexandra Canal for Yahoo Finance, Seth Goldstein, an equity strategist at Morningstar, noted that the market’s perception of Tesla’s growth has shifted positively. This change comes in the wake of Tesla’s Q1 deliveries, which fell short of expectations, leading the market to initially assume a lower growth rate. However, the recent stock rally suggests that investors are now more hopeful about Tesla’s future prospects.
As per Yahoo’s report, Tesla is set to release its next quarterly results on July 23 after the market closes. A key factor that investors are watching is Tesla’s development of more affordable electric vehicles. Goldstein emphasized the importance of Tesla providing a “solid, concrete timeline” for the rollout of these vehicles, which the company has indicated could happen as soon as 2025. This timeline is critical for maintaining investor confidence in Tesla’s growth narrative.
Goldstein told Yahoo Finance that for Tesla’s stock to remain strong, it is essential that the company meets or accelerates this timeline. If Tesla can demonstrate that it is on track for a second wave of deliveries growth starting in 2026, it will likely keep investor sentiment positive. However, if there are delays or if Tesla’s management appears uncertain about this timeline, it could lead to a decline in the stock’s value.
In addition to earnings and deliveries, investors are also looking at Tesla’s potential growth in the autonomous vehicle market. As highlighted by Yahoo Finance, Tesla is scheduled to unveil its much-anticipated robotaxi on August 8. This development is seen as another significant growth opportunity for the company, adding to the excitement and speculation surrounding Tesla’s future.