Tesla Share Price Hits Record High As Electric Carmaker Hits Targets

by Jonathan Adams

Tesla has seen its share price and valuation reach new record highs in the first several days of 2020. The electric car maker co-founded and run by controversial serial entrepreneur Elon Musk, saw its share price gain 3% on Friday January 4th to reach $443.01. That gave the company a total market capitalisation of around $80 billion.

Tesla is the most valuable carmaker in the USA by some distance. General Motors, the country’s biggest carmaker by revenues, sales and profits is worth only $52 billion, despite all its fundamentals being well ahead of Tesla’s. The latter’s lofty stock market valuation is driven by investors pinning their hopes on it having developed the technology and expertise to lead the future all-electric market for automobiles. Tesla is also at the forefront of the push towards the development of driverless vehicle technology – a market analysts believe will be hugely valuable in 10-20 years.

In the shorter term, the boost to Tesla’s share price has come from the company having met its new vehicle sales delivery targets for 2019. The company announced it had delivered 367,500 vehicles last year, in line with its self-set goal for between 360,000 and 400,000. Tesla has, in the past, been renowned for missing its own targets but finally appears to be turning that unwanted reputation around.

Tesla’s sales delivery figures have been helped along by recently ramped up production of the company’s Model 3. The Model 3 is Tesla’s first mass-market vehicle, with a basic model starting at $39,990. Despite being all-electric, the car has a top speed of 140 mph and nought to 60mph acceleration in 5.3 seconds.

At total of 92,550 Model 3 cars were delivered over the last quarter of 2019, beating analyst forecasts for 87,900. 19,450 of the more expensive Model S and Model X cars also contributed to the quarter’s total sales figures of 112,00. Forecasts had been for 106,000.

After Friday’s gains, Tesla is now the 3rd most valuable carmakers in the world, behind only Volkswagen and Toyota, which have market capitalisations of $98 billion and $204 billion respectively. Analysts are forecasting Tesla to deliver 463,000 vehicles this year, which would represent another year of significant growth if it can be achieved.

To that end, Tesla has stated its current focus is continuing to expand its production capacity. It has plants in the USA as well as a recently launched facility in Shanghai.

This article is for information purposes only.
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