Tesla's Electrifying Surge Reclaims Trillion-Dollar Status Amid Trump Speculation and Cybertruck Boost
1min read Tesla's (TSLA) impressive rally continues as the stock surged 8.19% last week, marking a four-day winning streak and a 32.28% gain over four days. This recent performance contributes significantly to a 29.01% weekly increase and has pushed the company's year-to-date gain to 29.27%, boosting its market capitalization to over $1 trillion.
The recent surge in Tesla’s stock price has been partly attributed to expectations of favorable policies under a potential second term for Donald Trump, who has been backed financially by Tesla CEO Elon Musk. Investors speculate that a Trump administration could reduce regulatory burdens, benefiting large tech companies like Tesla. This speculation has created a bullish sentiment, allowing Tesla's valuation to re-enter the elite group of trillion-dollar companies, which includes giants like NVIDIA and Apple.
The short-seller community, which traditionally views Tesla with skepticism, has suffered losses as the stock price climbed nearly 30% since early November. Hedge funds betting against Tesla recorded an estimated $52 billion in paper losses. However, there’s been a notable shift with fewer funds maintaining short positions, as many are adjusting their strategies following Musk's political maneuvers and Tesla’s strong performance.
On the product side, Tesla has addressed a backlog issue for the Cybertruck by offering new leasing options, starting at $999 per month with a $7,500 down payment. This move comes after overcoming production hurdles that delayed the vehicle's rollout since its announcement in 2019. Despite the recall due to a rearview camera issue, Tesla claims the Cybertruck is its third best-selling model.
Recent quarterly earnings reflected strong performance, with Tesla reporting $25.18 billion in revenue and $2.17 billion in net income. Musk suggests that vehicle growth could reach 20%-30% next year, driven by low-cost vehicles and advancements in autonomous driving technology. However, competition remains intense, with Alphabet’s Waymo gaining a commercial edge in autonomous driving services.
Musk is also leveraging his influence to push for changes in the autonomous vehicle regulatory landscape in the U.S., seeking a unified federal approval process, which he views as essential for Tesla’s future innovations. Amid these developments, Tesla's stock has remained at the forefront of investor attention, rising to heights not seen since late 2022.