Nov 8, 2024 - Energy & Climate
Tesla rejoins $1 trillion club
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Tesla pushed back into the $1 trillion market cap club following a surge in stock price Friday.
Why it matters: Just weeks ago investors were fretting about CEO Elon Musk's support for Donald Trump — now that they've both won, attention has turned to the potential benefits for the company.
What they're saying: Some analysts, notably longtime bull Dan Ives, expect Musk's cozy relationship with the President-elect to pay off for Tesla in the form of fewer regulatory hurdles.
- Others, like RBC global autos analyst Tom Narayan, are less optimistic about the reality EV makers will face if Trump fulfills his vows to repeal the Inflation Reduction Act and to plant new tariffs on imports.
- The former could curb demand for EVs through reduced subsidies and consumer credits. The latter would impact Tesla's plans to produce in Mexico.
Yes, but: Narayan conceded that he doesn't know "what's inside the hearts" of Trump and Musk.
- Close ties between the two could give one of Tesla's bolder robo-taxi strategies a boost, for example.
- "Autonomy is like 70% of my Tesla valuation," Narayan told Bloomberg.
- Federal deregulation of autonomous transportation technologies including full-self driving and robo-taxis, "would be tremendous" for Tesla and other companies doing the same thing, he added.
What we're watching: Shares of the EV-maker have risen nearly 30% after the U.S. presidential election.
- They rose about 7% on Friday, to help push the company beyond $1 trillion in market cap, which it first reached in October 2021.
