Tesla skeptic marvels at $48 billion boost from one data point

By the time Tesla reported 90,650 deliveries on Thursday, its shares had surged about 27% over the course of seven trading days, outpacing the S&P
...
File photo of Tesla CEO Elon Musk. (REUTERS)
File photo of Tesla CEO Elon Musk.

Tesla Inc.’s cars may run on batteries, but its stock price is fueled by “the power of the narrative," according to an analyst with a sell rating on the shares.

In a report Thursday, Joe Spak of RBC Capital Markets marveled at how the electric-car maker has managed to add about $48 billion of market capitalization by ginning up excitement about its quarterly vehicle deliveries.

Also check these Vehicles

Find more Cars
Tesla Model S (HT Auto photo)
UPCOMING
BatteryCapacity Icon75 kWh Range Icon396 km
₹70 Lakhs - 1 Cr
Alert Me When Launched
Tesla Model 3 (HT Auto photo)
UPCOMING
BatteryCapacity Icon82kWh Range Icon 555 km
₹ 70 - 90 Lakhs
Alert Me When Launched
Lexus Es (HT Auto photo)
Engine Icon2487.0 cc FuelType IconMultiple
₹ 56.55 - 62.19 Lakhs
Compare
View Offers
Bmw I4 (HT Auto photo)
BatteryCapacity Icon83.9 kWh Range Icon493 Km
₹ 69.90 Lakh
Compare
Volkswagen Id.7 (HT Auto photo)
UPCOMING
BatteryCapacity Icon77 kWh Range Icon621 Km
₹ 70 Lakhs
Alert Me When Launched
Hyundai Creta (HT Auto photo)
Engine Icon1497 cc FuelType IconMultiple
₹ 11 - 20.15 Lakhs
Compare
View Offers

On June 24, Tesla’s investor-relations team shared a collection of delivery estimates that found analysts on average were expecting the company to hand over about 70,300 vehicles to customers. The market recognized this as a low bar, triggering gains that were further supported by two bullish emails Chief Executive Officer Elon Musk sent to employees that leaked to several media outlets.

By the time Tesla reported 90,650 deliveries on Thursday, its shares had surged about 27% over the course of seven trading days, outpacing the S&P 500’s roughly 3% gain. The company added more market cap in that span than General Motors Co. or Ford Motor Co.’s entire valuations.

“That, is remarkable," Spak wrote. He estimates Tesla topped consensus delivery estimates by the equivalent of about $1 billion of revenue, meaning investors are valuing the beat at about 47.5 times sales.

First Published Date: 03 Jul 2020, 10:06 AM IST
NEXT ARTICLE BEGINS

Check Latest Offers

Please provide your details to get Personalized Offers

Choose city
+91 | Choose city
Choose city

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy
Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.