Tesla's stock price surged 12% on Thursday after the electric vehicle maker posted better than expected earnings.
Shares of Tesla Inc. (NASDAQ:TSLA) skyrocketed Thursday after the electric vehicle manufacturer reported better than expected earnings and signaled strong guidance for 2020.
Tesla’s share price peaked at $650.88 in New York trading, representing a gain of 12%. It was last seen trading around $635, up more than 9% on the day.
The electric vehicle maker has seen its market cap swell to nearly $115 billion.
TSLA stock is eyeing even bigger upside in the short term as the company ramps up deliveries to China, one of the largest target markets for electric vehicles. Analysts at Wedbush believe China demand can boost Tesla deliveries to 1 million units by 2022.
Tesla was one of the few bright spots on Wall Street Thursday. The technology-focused Nasdaq Composite Index plunged more than 1% through the early morning as fears of a coronavirus outbreak reverberated. The index was last down 0.7%.
The broad S&P 500 Index of large-cap stocks declined 0.6%, with most of the losses concentrated in communication services, materials and health care companies.
Tesla’s rally began late Wednesday after the company reported fourth-quarter earnings and revenue that were much higher than expected. Tesla’s per-share earnings of $2.14 on revenues of $7.4 billion smashed forecasts calling for an EPS of $1.62 on $6.95 billion in sales.
More importantly, the electric vehicle manufacturer said car shipments should “comfortably exceed 500,000 units,” which is a critical marker of success for a company once deemed to be in “production hell.”
Tesla’s breakout rally on Thursday cost short-sellers in excess of $1 billion, according to data from S3 Analytics that was reported by CNBC. Short sellers have shed more than $5.2 billion this year in mark-to-market losses. They lost a staggering $2.89 billion in 2019 as TSLA outperformed.
Despite getting burned over the past year, short-sellers still believe Tesla is overvalued. The company is still the most-shorted stock on Wall Street, having reclaimed that title from Apple earlier in January.
Disclaimer: The above should not be considered trading advice from CCN.com. The writer does not own shares of Tesla (TSLA).
Last modified: September 23, 2020 1:31 PM