Tesla's Stock: Will It Reach New Heights? A Comprehensive Analysis
As Tesla's stock hits new record highs, with its per-share price nearing $900 on January 13, 2021, the question on many investors' minds is: How much higher can Tesla go?
Current Market Cap and Recent Price Surge
Tesla's share price has seen a significant surge, going from 600 per share just a short while ago to a current closing price of $880 on January 8, 2021. This recent rise has made Tesla's market value surpass that of the combined market capitalization of Ford and General Motors. While Tesla's stock exhibits volatility, the general consensus among financial analysts is that the upward trend could continue, with some predicting a share price of $2,000 by 2025.
Investment Caution and Risk
While some eagerly jump into Tesla's shares, others caution against investing in hypothetical or speculative advice. Misleading statements like "4 billion. Buy now! Sell everything you have! Invest everything in Tesla! You can't lose!" could mislead inexperienced investors. It's crucial to remember that investment decisions should be based on thorough research and a careful analysis of market conditions.
Will Tesla Reach a $1 Trillion Market Cap?
Several financial analysts predict that Tesla could eventually reach a $1 trillion market cap, which would translate to a share price of $6,000. This target is not just a far-fetched dream: with Tesla's diverse portfolio ranging from electric vehicles (EVs) and renewable energy to software and potentially new services, the potential for substantial growth is undeniable.
Tesla: From Hardware to Software and Beyond
Tesla is more than just a car company; it is a tech company with a broad array of offerings. Currently, Tesla's primary source of revenue is from the sale of EVs, similar to how Apple generates revenue from the sale of iPhones. However, the company's future lies in its tech-focused endeavors, including software, apps, and a diverse range of products.
Tesla's product line extends far beyond just electric vehicles. The company also sells solar products and energy storage solutions, along with advanced AI driving software. Potential future ventures into ride-sharing, transport, shipping, and internet provision further diversify Tesla's revenue streams, enhancing its competitive edge in the market.
Capital Market and Potential Growth
The underlying drivers for Tesla's potential growth include its robust order backlog, capacity expansion, and innovative technology. Tesla's current market cap aligns with its extensive product offering and future potential. For example, if we consider the market cap for each area in which Tesla could play a significant role, the sum amounts to trillions. Being a small but significant player in these sectors could propel Tesla towards achieving a $1 trillion market cap.
A recent internal calculation showed Tesla's market capitalization per vehicle produced to be approximately $150,000. This figure underscores the immense value that Tesla brings to its shareholders, even as it continues to ramp up production.
In conclusion, while the stock market is inherently unpredictable, Tesla's strategic diversification and steady growth in both hardware and software suggest a promising future. As the question on every investor's mind, 'How much higher can Tesla go?' remains open, but one thing is clear - the sky's the limit until it inevitably goes down.