Tesla's Bitcoin Surge: $600M Gain as BTC Price Rises

Tesla, the electric vehicle manufacturer, has reported a significant gain of $600 million in the fourth quarter of 2024, primarily due to the revaluation of its Bitcoin holdings under new accounting rules. The company held 9,720 Bitcoin (BTC) valued at $1.07 billion at the end of last year, marking a substantial increase from the previously reported $184 million worth of Bitcoin.

The change in value is attributed to a rise in the price of BTC and the implementation of a new accounting rule that requires the value of Bitcoin and other cryptocurrencies to be reported using a marked-to-market process. Previously, corporate holders of Bitcoin were required to report their digital holdings at their lowest valuation during the time of ownership. This new accounting rule provides a more accurate reflection of the current value of Tesla's Bitcoin holdings.

Tesla's Bitcoin holdings, valued at $1.07 billion, make it the sixth-largest publicly traded company to hold the largest cryptocurrency by market capitalization on its balance sheet. However, it is essential to note that any gain on Tesla's Bitcoin holdings was for accounting purposes only and had no effect on the company's earnings per share (EPS). In the fourth quarter of last year, Tesla's EPS came in at $0.73, missing Wall Street forecasts of $0.76.

Tesla stock has gained 103% in the last 12 months, and currently, it has a consensus Hold rating among 30 Wall Street analysts. This rating is based on 12 Buy, 10 Hold, and eight Sell recommendations made in the last three months. The average TSLA price target of $339.15 implies a 12.84% downside risk from current levels.