Yesterday, Tesla (NASDAQ:TSLA) broke the $2,000 per share barrier. During Thursday’s intraday peak of 2,021.99 per share, Tesla had a market cap of over $378 billion. This allowed the electric car maker to overtake Walmart, which has an impressive market cap of $368 billion, as per data from YCharts.com.
Interestingly enough, Walmart is actually the S&P 500’s 10th-biggest company. This means that if Tesla were actually part of the index, it would now be the 9th largest member of the S&P 500.
Tesla’s momentum appears to be partly driven by the company’s announcement that it would be implementing a 5-for-1 stock split in late August. Since the announcement, TSLA stock has seen a 45% rise, cementing its place as one of the best-performing stocks today with a 378% year-to-date rise. Anticipation for the company’s inclusion into the S&P 500 also brings more enthusiasm for the stock.
The electric car maker is expected to be included in the S&P 500 index after it registered four consecutive profitable quarters. That being said, Tesla’s recent bull run is notable, especially considering that Walmart, the company that the electric car maker recently overtook in market cap, recorded around $500 billion more revenue than Tesla in its last fiscal year. That being said, Tesla carries a lot of optimism among investors, and the company is showing a lot of potential growth in the coming years.
Tesla has been largely considered as an electric vehicle maker for a long time, and for good reason. CEO Elon Musk’s Master Plan for the company involves the release of compelling electric vehicles that encourage conventional car buyers to choose sustainable transportation over fossil fuel-powered cars. However, Tesla has expanded its business significantly, and some of these other opportunities are rarely considered by analysts covering TSLA stock.
The opportunities from Tesla’s battery storage business, for example, is only mentioned by a select few bulls like billionaire investor Ron Baron. This is despite Elon Musk noting that the energy and utility market far outsizes the vehicle segment. Margins are also estimated to be fairly high with Tesla’s battery storage products, since the devices are not as complex as the company’s electric vehicles. This is represented by the Megapack, Tesla Energy’s flagship battery storage product, which already proved profitable in the second quarter.
Other potential areas in Tesla’s growth include autonomous driving and ride-hailing services. Tesla has announced its plans to deploy an autonomous Robotaxi service, but just like its energy business, the opportunities of a ride-hailing business are only recognized by a select few TSLA bulls like Cathie Wood of ARK Invest.
As of writing, TSLA stock is trading 2.86% at $2,059.00 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
