Investor's Corner
Tesla shorts burned anew with TSLA's record $70B market cap and new all-time-high
Tesla (NASDAQ:TSLA) has dealt another painful blow to short-sellers on Wednesday, as the electric car maker hit a record market cap of $70 billion and shares hit new all-time-highs. TSLA has achieved these milestones as ardent bulls and even longtime bears from Wall Street begin acknowledging the company’s substantial lead in the electric vehicle space.
Tesla continued to show strength on Wednesday’s intraday, with the stock climbing over 2%. This ultimately pushed the electric car maker’s market cap to a record high of $70 billion, marking its place as the world’s 3rd-most valuable carmaker. TSLA shares also traded as high as $389.28, beating the company’s previous all-time high of $386.99, which was reached on June 19, 2017.
In a recent update, S3 Partners Managing Director of Predictive Analytics Ihor Dusaniwsky noted that there appears to be a squeeze going on today, though not at a scale that would qualify as Tesla CEO Elon Musk’s “short burn of the century.” “$TSLA shares shorted is -118k below 1/1/19 level – seems there has been a squeeze of 2019’s first half of the year short activity,” the S3 Partners Managing Director wrote.
While the stock’s current levels are likely not yet enough to trigger a full-on short squeeze, Dusaniwsky has previously stated that there would likely be a good amount of short covering in the $390 range since shorts would be down another -$1.5 billion in mark-to-market losses at those levels. With the ATH now breached and the stock seemingly on the verge of knocking on $390 per share, TSLA shares are now approaching the S3 Partners’ expected short squeeze range.
Tesla is enjoying some momentum as of late. In a recent appearance at CNBC‘s Squawk Box, TSLA bull Colin Rusch of Oppenheimer stated that the electric car maker has already made it through its most difficult days. When faced with the argument from Vanity Fair‘s Bethany McLean that Tesla’s futures may be in some way in danger due to Elon Musk’s capability to raise money and the company’s potential profitability issues, Rusch was quick to point out that such statements are no longer relevant to Tesla at this stage.
“I don’t think this is about Elon anymore. This is about what’s going on in the market with cars. Consumers are going towards premium and sustainable solutions. They’re willing to pay for that sustainability. They’ve got $5 billion of cash on the balance sheet, and they’re growing with a lot of operating leverage. I think your point was relevant a year and a half ago, maybe two years ago, and now it’s just not,” Rusch said.
Even when faced with the argument that more and more people were buying larger trucks and SUVs, Rusch was quick to correct the CNBC panel that such trends are true in the United States, but not necessarily the entire world. The analyst is correct on this point, as large vehicles that are extremely popular in the US such as the Ford F-150 are generally not preferred by consumers at all in large regions such as Europe. This is a reason why the Model 3, a sedan, continues to perform well on the market.
As of writing, Tesla stock is trading +2.67% at $389.11 per share.
Watch Colin Rusch’s of Oppenheimer engage CNBC‘s panel in the video below.
Tesla stock (NASDAQ: TSLA) closed at an all-time high on Tuesday, jumping over 3 percent during the day and finishing at $489.88.
The price beats the previous record close, which was $479.86.
Shares have had a crazy year, dipping more than 40 percent from the start of the year. The stock then started to recover once again around late April, when its price started to climb back up from the low $200 level.
This week, Tesla started to climb toward its highest levels ever, as it was revealed on Sunday that the company was testing driverless Robotaxis in Austin. The spike in value pushed the company’s valuation to $1.63 trillion.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
It is the seventh-most valuable company on the market currently, trailing Nvidia, Apple, Alphabet (Google), Microsoft, Amazon, and Meta.
Shares closed up $14.57 today, up over 3 percent.
The stock has gone through a lot this year, as previously mentioned. Shares tumbled in Q1 due to CEO Elon Musk’s involvement with the Department of Government Efficiency (DOGE), which pulled his attention away from his companies and left a major overhang on their valuations.
However, things started to rebound halfway through the year, and as the government started to phase out the $7,500 tax credit, demand spiked as consumers tried to take advantage of it.
Q3 deliveries were the highest in company history, and Tesla responded to the loss of the tax credit with the launch of the Model 3 and Model Y Standard.
Additionally, analysts have announced high expectations this week for the company on Wall Street as Robotaxi continues to be the focus. With autonomy within Tesla’s sights, things are moving in the direction of Robotaxi being a major catalyst for growth on the Street in the coming year.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
Tesla stock closes at all-time high on heels of Robotaxi progress
Tesla needs to come through on this one Robotaxi metric, analyst says
