On Monday, the market cap of Tesla Inc. reached $600 billion, putting the Silicon Valley electric-car producer on track to become the sixth-largest company in the S&P 500 index until it is added in two weeks to the benchmark.
For a record close, Tesla stock (TSLA) was poised, which it has notched more than 30 times this year. With the S&P inclusion news, it got another tailwind, and last week the index provider announced that the business would be added to the benchmark all at once (link).
This year, Tesla shares gained 663 per cent, compared with losses for the S&P of about 14 percent. Its present market cap is higher than Toyota Motor Corp.’s $193 billion market cap (7203.TO), except the U.S. Shares in the Treasury. The market value of Tesla is also higher than the Ford Motor Co. (F), Fiat Chrysler NV (FCA.MI), and General Motors Co. (GM) aggregate market caps.
The new run comes ahead of the S&P 500 listing, scheduled for trading to begin on Dec. 21.
It took 111 days for Tesla to jump from a mid-January market valuation of $100 billion to $200 billion by the end of June, then a short 13 days to get to $300 billion by mid-July.
The $400 billion marks, struck in August, lasted 27 days. It was a relatively sluggish 63 days from there to cross today’s $514 billion.
S&P Dow Jones Indices took the unusual step of consulting investors on whether it would add Tesla in separate tranches or all at once, underlining the difficulty of adding the heavyweight to the benchmark.
In November, the index revealed its intention to add Tesla all at once. The addition of Tesla to the larger, leading U.S. stock benchmark would immediately position the shares in the portfolios of countless index-tracking funds, cascading on to the many controlled funds that will have to follow suit to align their holdings.
It will also provide Tesla shares with even greater exposure and a measure of comfort for individual investors.
The stock run of Tesla also parallels the action in other stocks connected to electric cars and electric vehicles. This year, American depositary receipts from Nio Inc. (NIO), a Shanghai-based EV producer, have skyrocketed by 1,030 percent.
After the electric-truck manufacturer reported a watered-down deal with GM, Nikola Corp. (NKLA) share gains took a hit last week. Still, even though the firm has no sales and short-sellers have raised several concerns about its business model, the stock is up 79 percent for the year. In November, Nikola said that he had made significant progress on key milestones.”