Tesla’s market value surged past the $1 trillion mark on Friday, following a sharp rally driven by expectations that CEO Elon Musk’s companies will benefit from favorable treatment under President-elect Donald Trump. Tesla’s stock jumped 8.2%, reaching $321.22, marking its first time above the trillion-dollar threshold in over two years.
The stock rose 29% this week, adding over $230 billion to its market capitalization, its largest gain since January 2023. Analysts believe that Tesla and Musk are among the biggest beneficiaries of Trump’s election win, anticipating that Trump’s administration will expedite regulatory approval for Tesla’s autonomous driving technology.
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Garrett Nelson, senior equity analyst at CFRA Research, stated that Trump’s victory could lead to favorable regulation of Tesla’s self-driving plans and possibly delay any enforcement actions by the U.S. National Highway Traffic Safety Administration concerning Tesla’s driver-assistance systems.
Musk has shifted focus toward self-driving technology, abandoning plans to build a low-cost car under $30,000. However, regulatory and development delays have hindered the commercialization of such technologies.
David Whiston, equity strategist at Morningstar, added that if Musk can convince Trump to establish federal autonomous vehicle regulations, it would be beneficial for the auto industry, as a unified set of rules would be preferable to state-specific regulations.
Musk’s wealth has surpassed $300 billion, according to Forbes’ real-time billionaires list. Tesla shares rose sharply in late October after the company reported a rise in quarterly profit margins and projected 20% to 30% growth in deliveries for the upcoming year.
Tesla has remained the world’s most valuable automaker, far ahead of competitors like Toyota, BYD, and others. Tesla’s shares trade at 93.47 times their 12-month forward earnings estimates, compared to 38.57 for Nvidia, 30.77 for Microsoft, and 6.29 for Ford.
