The fortune of the richest man in the world, the head of Tesla, Elon Musk, jumped by 14.5 billion dollars as the share of the electric vehicle company increased by 9.4% after the rise of 2.5% of the Nasdaq, after from the fall of the previous week.
Analysts attributed Tesla’s outperformance to both Musk’s comments and broader market players.
Referring to an interview given by Musk to Bloomberg at the Qatar Economic Forum in which the head of Tesla highlighted the size of the company’s outstanding balance, Wedbush analyst Dan Ives said that “positive feedback on the demand from Musk has “They have given some confidence in this macroeconomic environment.”
In the interview, Musk reiterated his concerns about a recession and the need to reduce Tesla’s workforce, but investors seem to have ignored his comments that downplay the threat of competition and see it as the main obstacle to the company coping. in high demand, supply problems.
“As everyone who has tried to order a Tesla knows, the demand for our cars is extremely high and the waiting list is long,” Musk told Bloomberg. “This is not appropriate and we are increasing production capacity as soon as possible.”
According to RiskReversal Advisors founder and CEO Dan Nathan, this comment may have been encouraging to them, as Musk is known to send encouraging messages to employees, as he did last week.
Nathan adds that “in the last year, Tesla’s stock in the last month of each quarter has had big rallies in recent weeks from its lows.” But it also warns that Musk’s comments about a recession and prolonged production problems in China may prepare investors for lower-than-expected earnings and deliveries in the second quarter.
GLJ Research CEO Gordon Johnson says the sharp rise in Tesla’s share price is due to broader market players, noting that with stocks coming out of the worst week since March 2020 last week, “the “S&P 500 relative strength indicates that the stock market is oversold, and stocks like Tesla are going to recover.”
But none of that is fundamental, said Johnson, who is bearish on Tesla shares, and expects the company ‘s deliveries and earnings in the second quarter to be disappointing.
“Therefore, with Tesla trading about 50 times its future earnings against 4.6% of its industry bonds, we believe that any fundamental frustration is likely to send shares lower.”
This prospect may be scary for both Tesla investors and Elon Musk. But at least for now, he remains the richest man in the world at $ 228.4 billion, according to Forbes estimates, about $ 88 billion more than the second richest man, Bernard Arnault, of the French group LVMH.
Source: Capital
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