Tesla's $23.2B Volume Ranks Second as Shares Near 12-Month High Amid Governance Risks from $32.5B Musk Grant

Tesla (TSLA) closed at $339.75 on Aug. 13, down 0.43% with $23.23 billion in trading volume, the second-highest on the day. The stock remains near a 12-month high after a 10% rebound over five days but trades 16% below its 2025 year-to-date peak. A $32.5 billion stock grant for Elon Musk, contingent on his continued executive role, has intensified investor debate over governance risks. The award, vesting over two years, deepens the founder’s financial alignment with Tesla’s valuation, which is already tied to his stakes in SpaceX and xAI.

Q2 2025 results highlighted margin compression, with revenue falling 11.8% year-over-year to $22.5 billion. Automotive revenue declined sharply, particularly in Model 3/Y and other segments, while gross margin contracted to 17.2%. Free cash flow plummeted 89% to $146 million, driven by higher capital expenditures and lower operating cash flow. Strategic initiatives include a 2026 Cybercab launch, expanded robotaxi trials, and a lower-priced model to offset the U.S. EV tax credit expiration in September.

Institutional activity and analyst price targets reflect valuation divergence. Deutsche Bank increased Tesla holdings by 20.8% in Q1 2025, while Wall Street estimates range from $115 to $500, averaging $302. The stock trades at over 12x sales and a forward P/E near 200x, pricing in aggressive growth assumptions. Analysts cite uncertainty around autonomous driving execution, regulatory risks, and competitive pressures in EV and AI sectors as key variables.

A backtested strategy of buying the top 500 most actively traded stocks and holding for one day from 2022 to 2025 yielded a 6.98% CAGR with a maximum drawdown of 15.46%. While the approach showed steady growth, the mid-2023 downturn underscores the volatility inherent in volume-driven trading.