Tesla Shares Surge 6% to Record, Driving Elon Musk’s Wealth to $400 Billion
On Wednesday, Tesla Inc. shares experienced a significant surge, climbing approximately 6% to reach $424.77, a figure that refreshes their record previously set on November 4, 2021. This upward trajectory marks the sixth consecutive day of gains for the U.S. electric vehicle (EV) heavyweight, further boosting CEO Elon Musk’s personal wealth to an astonishing $400 billion.
Elon Musk now holds the title of being the first billionaire with a net worth exceeding $400 billion. This landmark achievement is largely attributed to the recent rallies in Tesla’s stock price. A substantial portion of Musk’s fortune is tied up in his Tesla holdings. According to the latest filings, Musk owns 411.06 million Tesla shares and approximately 304 million performance-based options. Tesla stock and options constitute about three-quarters of his personal wealth, complemented by his significant stakes in SpaceX, social media platform X, and AI startup xAI.
As of this Wednesday, Tesla shares have skyrocketed by roughly 69% since the U.S. presidential election victory of Donald Trump, adding more than $556 billion to the company’s market capitalization over a span of five weeks. Despite these impressive financial moves, Elon Musk’s political contributions have also made headlines, reportedly crossing $132 million this year. This puts him among the top contributors to political campaigns, with substantial funds directed toward a political candidate and a party. He has also expressed intentions to give away $1 million per day to voters in swing states for supporting a petition from his Political Action Committee backing the Constitution.
Trump’s victory has seemingly signaled a positive turn for Musk’s strategic investments. Investors speculate that Musk and his enterprises, including Tesla, may benefit from Donald Trump potentially returning to the White House. Roth MKM analyst Craig Irwin, known for his previous bearish stance on Tesla, recently stated that Tesla stocks are, indeed, experiencing a “Trump bump.”
Contrarily, Wedbush analyst Dan Ives mentioned last month in a research note that while a Trump victory might initially appear detrimental to the broader EV industry, it could ultimately boost Tesla shares by $40 to $50. “Tesla has the scale and scope that is unmatched,” Ives noted. He highlighted that this situation could potentially afford Musk and Tesla a distinct competitive edge in an environment devoid of EV subsidies, particularly with anticipated higher China tariffs that might discourage cheaper Chinese EV players.
Beyond the political landscape, Wall Street analysts are optimistic about Tesla’s strides in self-driving technology and its endeavors in artificial intelligence (AI) and robotics. Bank of America Securities analyst John Murphy expressed confidence in Tesla’s future, especially beyond 2025, after a visit to Tesla’s Gigafactory in Austin. “The trip enhanced our belief that Tesla is strategically positioned to expand in 2025 and beyond with its core EV business and anticipated robotaxi launch, further supported by long-term investments in Optimus,” Murphy remarked. He also observed that Tesla is currently employing Optimus to efficiently sort through battery cells autonomously, with tests showcasing the robot’s dexterity through tasks like catching tennis balls.
Reiterating a Buy rating for Tesla, Murphy increased his price target from $350 to $400, symbolizing a 14.3% rise.
Additionally, Goldman Sachs analyst Mark Delaney has uplifted his price target from $250 to $345, a rise of 38%, while maintaining a Neutral rating. Delaney commented, “Despite some underlying challenges to the core auto business in the near to mid-term and perceiving the valuation as full, we recognize a possibility for the stock to sustain a higher valuation multiple. This reflects the long-term potential associated with Full-Self Driving (FSD) and robotics amid growing market interest in potential AI beneficiaries. Tesla’s stock is trading near the higher end of its historical range based on NTM non-GAAP EPS.”
