/electric%20car%20charging%20parking%20spot.jpg)
Many market participants worried Elon Musk’s preoccupation with Twitter would distract him from his flagship company, Tesla (TSLA). As the end of the first half of 2023 approaches, TSLA shares have again made any doubters look foolish as they more than doubled from the January 2 low.
TSLA shares exploded higher, and the EV maker’s market cap has left other EV companies and all carmakers in the dust.
Over the past years, doubting Elon Musk has been a tragic financial mistake.
TSLA exploded higher since the early 2023 low
TSLA’s all-time high was in November 2021 at $414.50 per share.
The chart highlights the 75.4% drop to $101.81 on January 6, 2023. Many investors who rode the TSLA wave higher took profits during the decline, and some market participants shorted TSLA. However, the shares found a bottom in early 2023 and rallied to a $276.99 high on June 21, 2023. At the $256.60 level on June 23, TSLA shares were up more than 152% since the early 2023 low.
Leading all EV makers
TSLA is the world’s leading EV maker.
Source: companiesmarketcap.com
The chart highlights the top ten publicly traded EV manufacturers with market caps above the $1 billion level. TSLA’s market cap is nearly twenty-five times the second leader, Li Auto, and the $813.29 billion market cap is 88.3% of the sector’s total market value. TSLA remains the 800-pound gorilla in the EV market.
Leading all carmakers
Even more impressive is TSLA’s position in the publicly traded carmaker sector.
Source: companiesmarketcap.com
The chart shows TSLA is the leader of all publicly traded automakers, and its market cap is an astonishing 37% of the sector. TSLA’s value is almost four times second-place Toyota (TM).
Targets for TSLA shares
The bearish trend in TSLA shares lasted from November 2021 until January 2023. Ironically, in the same period, cryptocurrencies experienced the latest bust period. TSLA, its leader Elon Musk, and cryptos have something in common; innovation that challenges the status quo. Elon has been a big crypto supporter and investor, but TSLA’s success has been the demand growth for electric vehicles.
The trend is always your best friend in markets across all asset classes, and TSLA’s over 152% gain since the start of 2023 makes the path of least resistance higher.
The chart illustrates the first technical target stands at the August 2022 $314.67 high; above there, the resistance is at $384.29; the April 2022 high, $402.67; the January 2022 peak, and the November 2021 record $414.50 level.
Technical support is at $152.37, the April 2023 low.
Buying TSLA shares during selloffs has been treacherous, given the stock’s penchant for extreme volatility. However, investors that believed in Elon Musk when the shares collapsed from the late 2021 high and bought on a scale-down basis have reaped significant rewards.
Doubting Elon Musk has been a losing proposition
While TSLA’s Q1 earnings showed net income fell 24% to $2.51 billion, from $3.32 billion in the prior year, earnings were 85 cents, as expected, and revenue of $23.33 billion was slightly above the forecast $23.21 billion.
Many market participants doubted Elon Musk’s ability to manage TSLA, SpaceX, the Boring Company, his other interests, and his high-profile purchase of Twitter, the social media giant. After all, being CEO of one company is a tough job. Managing a handful of businesses is beyond the scope of even the most competent leader. Elon Musk is one of the very few individuals who can balance an enormous workload and responsibilities, and betting against him will likely be a losing proposition as he continues to crush the competition.
On the date of publication, Andrew Hecht did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
