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Tesla shares rose to a two-year high

Online Niel November 9, 2024

Akash Sriram
| Reuters

Nov 8 (Reuters) – Tesla’s TSLA.O market value passed the $1 trillion mark in a sharp rise on Friday, on growing bets on favorable treatment for CEO Elon Musk’s companies in return for support his for President-elect Donald Trump’s polling campaign.

Shares of the electric car maker rose more than 6 percent to a more than two-year high of $315.56 after gaining 19.3 percent through Thursday’s close. The company surpassed the $1 trillion valuation for the first time in more than two years.

The billionaire could push for favorable regulation of Tesla’s planned self-driving vehicles and also get the US National Highway Traffic Safety Administration to delay potential enforcement actions involving the safety of Tesla’s current driver assistance systems, a a source told Reuters.

Musk focused on autonomous vehicle technology, abandoning plans to build an economy car priced under $30,000. However, development and regulatory hurdles have delayed the commercialization of such technologies.

“Tesla and CEO Elon Musk are likely the biggest winners from the election result, and we believe Trump’s victory will help accelerate regulatory approval of the company’s self-driving technology,” said Garrett Nelson, senior analyst at CFRA Research.

Tesla shares rose in late October after the company reported a rise in its quarterly profit margin, boosted by sales of its hugely profitable Full Self Driving driver assistance software.

It has been the world’s most valuable automaker for years, with Japan’s Toyota Motor 7203.T, China’s BYD 002594.SZ and others several hundred billion dollars ago.

Tesla shares trade at 93.47 times its 12-month estimates, compared with 38.57 for AI chip giant Nvidia NVDA.O, Microsoft’s MSFT.O 30.77 and Ford’s FN 6.29.

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Reporting by Akash Sriram in Bengaluru; Editing by Arun Koyyur