Tesla Stock Jumps 6% as Elon Musk is Now World’s Second Richest Person

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Principal Points

• Elon Musk’s journey to success
• Abundance flows for Tesla

The price of Tesla stock has sky-rocketed this year, posting an increase of over 500% year to date and 35.2% month to date. Company shares shot up over 6% on Monday to a record close of $521 per share and a market cap close to $500 billion. Elon Musk has now added more than $100 billion to his net worth this year alone and is now ranked as the second richest person in the world, passing Bill Gates. According to the Bloomberg Billionaires Index, Elon Musk is now valued at $128 billion, adding $7 billion on Monday.

Monday’s rally in Tesla comes a week after the official announcement that the company’s stock will be added to the S&P500 index in December. Moreover, Daniel Ives, a Wedbush analyst, raised the share price target in the best-case scenario to $1,000 as he anticipates a “major inflection” in electric vehicle demand, and Tesla as the EV producer to take the number one spot. The Wall Street analyst raised his base-case price target on Tesla from $500 to $560, while saying that he envisions the giant carmaker to be worth more than double by the end of 2021. Currently, EV sales make up about 3% of global car sales. The forecast, according to Ives, is that 1 car in every 10 sold will be electric by 2025.

An Abundant Year For Tesla

For Elon Musk and Tesla, 2020 has been very lucrative so far. It has to be noted, that the EV maker commenced 2020 with the vision to deliver 500,000 vehicles by the end of the fourth quarter. The company has delivered about 320,000 cars for the first three quarters. Wall Street expects the company to deliver around 800,000 vehicles in 2021. Current performance, however, is not the main driver that is attracting investors’ attention. Rather, Tesla has a significant amount of growth expectation incorporated into its share price as investors consider the company to be the leader in the EV market for years to come as countries progress to a greener future. Electric vehicle makers’ shares are up double digits in 2020, from small companies to the undisputed leader Tesla.

With Monday’s move, Elon Musk surpassed Bill Gates. This comes after a social media confrontation in September. Indeed, Elon Musk ridiculed Bill Gates on Twitter, saying that the Microsoft founder has “no clue” about electric trucks. Bill Gates’ net worth remains a tad below Musk’s, but it has to be mentioned that Bill Gates has donated more than $27 billion through his foundation since 2006.

The last time Tesla stock reached a record high was on Nov 19 when shares traded at $499. The record move on Monday lifted the price to a new all-time high of $524. Pre-market data indicate a higher open on Tuesday as Tesla is currently projected to start trading in the neighborhood of $530 per share. The broad market indicates a higher open as well with US benchmark indexes flashing green led by Dow Jones futures up about 1.00% in the pre-market trading.

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