- Tesla Inc.’s market value crept briefly above $100 billion, a threshold that will trigger a huge payout for Elon Musk if he can sustain the feat for months.
- The shares of the electric car producer increased by as much as 1.4% in the after-hours trading on Tuesday after the regular session was closed by 7.2%.
For the first time, Tesla Inc.’s market value crept briefly above $100 billion, a threshold that will trigger a huge payout for Elon Musk if he can sustain the feat for months.
The shares of the electric car producer increased by as much as 1.4% in the after-hours trading on Tuesday after the regular session was closed by 7.2%. Tesla’s market capitalization was about $100.1 billion at the post-market peak of $555.10, just shy of the $100.6 billion Volkswagen AG’s.
Musk, Tesla’s billionaire chief executive, is eligible to receive the first tranche of an all-or-nothing pay award if the company’s market value for a sustained period remains above $100 billion. The first chunk of the award would net him roughly $346 million on paper.
Tesla’s shares have more than doubled since the company reported a third-quarter surprise profit and told investors that it was ahead of schedule to open its factory in China and deliver its next model, the Model Y crossover. Musk, 48, has built a commanding lead over established automakers selling electric vehicles.
The most bullish analyst on Tesla at Wall Street was behind Tuesday’s run. New Street Research analyst Pierre Ferragu predicted the company will sell at industry-leading margins from 2 million to 3 million cars per year after 2025. He boosted his price target from $270 to $800, Bloomberg’s highest among analysts.
Tesla, a seventeen-year-old car maker, is now worth twice as much as Ford, a centuries-old car giant, after a spike in its stock price. Over the past few months, Tesla’s stock has been on a roll, rising from $255 in October to $443 over the close of the market on Friday.
Tesla’s stock has risen because for once Tesla has succeeded in addressing one of its most frequent bugbears— selling as many vehicles as it had expected. In 2018, Ford’s CEO had trolled Elon Musk to rejoice as Tesla delivered 7,000 cars a week, haughtily saying that in 4 hours Ford made that many vehicles. Yet things have changed since then— during the fourth quarter of last year, Tesla shipped 112,000 vehicles over the analyst estimates of 106,000 vehicles. There are 92,500 Model 3 vehicles and 19,450 Model S / X vehicles in Tesla numbers. Tesla delivered 50% more cars in 2019 than in the previous year.