Topline
Tesla stock rallied more than 10% once again Friday as Wall Street regains faith in the often volatile electric vehicle stock led by its often volatile billionaire CEO Elon Musk.
It’s been a historic stretch for Musk’s company.
Key Facts
Tesla shares rose 11% Friday following Thursday’s 11% rally on the heels of the company’s robust quarterly earnings report, bringing the stock’s two-day gains to 23%.
That’s Tesla’s best two-day stretch since April 14, 2020 and its eighth-best two-day performance in the stock’s nearly 13-year history, according to Yahoo Finance data.
The stock is now up 62% over the last month, the largest gain over the stretch of any company in the S&P 500, according to FactSet data.
Tesla bears are “going into hibernation mode” after the company posted its best-ever quarterly profit and sales and shared optimistic guidance, Wedbush analyst Dan Ives wrote in an email to Forbes.
Ives notes the rally is a mix of increased institutional investments and a short squeeze, a market event when a stock price rises rapidly as a glut of short sellers close out their positions.
Key Background
Tesla is the most popular options trade on the derivatives market, aside from the S&P 500 fund, helping drive the stock’s frequent significant movement in either direction. Though Tesla is now up more than 60% over the last month, the stock is still down 57% from its November 2021 peak. Shares of the automaker tanked 65% in 2022, far outpacing broader market losses, with a large portion of the losses spurred by Musk diverting a significant portion of his time and financial resources from Tesla to Twitter, the social media company he bought in October.
Big Number
$104 billion. That’s how much market capitalization Tesla has tacked on over the last two days, just shy of the combined market cap of Ford and General Motors, the next largest American car companies.
Forbes Valuation
Elon Musk remains the world’s second-wealthiest and the nation’s richest person, per our estimates, though the margin between him and the planet’s wealthiest man, LVMH chairman Bernard Arnault, is shrinking. Musk’s $182 billion net worth is $22 billion larger than it was Wednesday and is $32 billion smaller than Arnault’s $214 billion fortune.
Further Reading
Tesla Has Become One of the Hottest Stock-Option Trades on Wall Street (Wall Street Journal)
Tesla Posts Best-Ever Quarterly Revenue And Profit (Forbes)
Tesla Gains 11% As Strong Earnings Outweigh Musk’s ‘Distractions’ (Forbes)
Source: https://www.forbes.com/sites/dereksaul/2023/01/27/tesla-shares-rally-11-capping-best-2-day-stretch-since-2020/