Tesla’s stock has experienced a remarkable surge, regaining its popularity after Donald Trump’s victory in the US election, as investors anticipate a new phase of growth driven by the company’s Robotaxi and Full Self-Driving (FSD) technology.
The rally, which saw Tesla’s shares climb 69% to a record high in just over a month, added $55 billion to its market value, bringing it to $1.35 trillion. Year-to-date, Tesla’s stock is up 57%, reversing its pre-election decline.
This surge makes Tesla the biggest beneficiary of Trump’s election win among the “Magnificent Seven” stocks, largely due to Elon Musk’s vocal support for the president-elect during the campaign. The rally pushed Tesla’s Price-to-Earnings (P/E) ratio to 103, the highest among the leading tech stocks. For comparison, Nvidia, a leader in artificial intelligence, has a P/E ratio of 54.
However, the rally wasn’t driven solely by Trump’s victory. Tesla’s stock also rebounded after strong third-quarter earnings, with shares jumping 12% on October 22. The company’s automotive revenue grew 2% year-on-year, marking a return to growth after declines in the previous two quarters. Total revenue rose by 8% year-on-year, marking the highest growth in a year.
Elon Musk has projected a 20%-30% increase in automotive deliveries in 2025, signaling renewed demand for electric vehicles. In the third quarter, Tesla delivered 462,890 electric vehicles, a 6.4% year-on-year increase, marking a return to growth after two consecutive quarterly declines. This figure was the highest third-quarter total and the third-largest quarterly total in the company’s history.
These factors, combined with investor optimism about Tesla’s future technological advancements, have propelled the company’s stock to new heights.
