Tesla (NASDAQ: TSLA) has officially reached a $1 trillion valuation after the stock price passed $1,000 per share today. The company’s valuation makes it the sixth company to currently be worth $1 trillion or more.
Tesla stock surged on Monday morning following news of a massive deal with Hertz, a car rental agency. Hertz agreed to purchase 100,000 Tesla Model 3 electric sedans for its fleet of rental cars in a deal worth $4.3 billion. Hertz will make Model 3 vehicles available to customers as soon as November, the company said.
Tesla’s stock price surged over 12% on the news of the deal and was trading at $1,020 at the time of writing.
Tesla joins Apple, Microsoft, Saudi Aramco, Google parent company Alphabet, and Amazon as the only companies to be worth $1 trillion. Facebook was formerly worth a valuation of $1 trillion, but the company’s stock has slid in the past few weeks.
The news of the Hertz and Tesla deal was groundbreaking and undoubtedly helped surge the stock price on Monday. Analysts looked at the move as a tell-tale sign of the ongoing transition to electric vehicles. With rental agencies now planning to adopt electric cars within their fleet as a sign of the ongoing transition to electrification, analysts are seeing bullish signals in Tesla’s future.
Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest,” Mark Fields, Interim Chief Executive of Hertz, said. “The new Hertz is going to lead the way as a mobility company, starting with the largest EV rental fleet in North America and a commitment to grow our EV fleet and provide the best rental and recharging experience for leisure and business customers around the world.”
Analysts Dan Ives and Pierre Ferragu commented on the move this morning, essentially patting Tesla on the back for leading the EV charge while creating a massive revenue opportunity in the deal with Hertz. “While Hertz is in the early stages of electrifying its rental car fleet, Tesla getting an order of this magnitude highlights the broader EV adoption underway in our opinion as part of this oncoming green tidal wave now hitting the U.S.,” Ives wrote in a note to investors.
Disclosure: Joey Klender is a TSLA Shareholder.