Tesla Inc. (TSLA) - Get Report extended its extraordinary rally into an 11th straight session Friday as the value of the clean-energy carmaker overtakes Facebook (FB) - Get Report and elevates Founder and CEO Elon Musk to the status of the richest man in the world.
Tesla's stunning 2020 rebound, driven by the group's expanded manufacturing footprint, which helped full-year deliveries rise to a record 499,550 units while posting four consecutive quarters of profits, has not only placed the Palo Alto tech car maker as the fifth largest company on the S&P 500, but has also boosted Musk's net worth to $188.5 billion, according to Bloomberg estimates.
It's also elicited a series of mea culpas on Wall Street, with analysts scurrying to increase their price targets on the soaring shares while forecasting ever-stronger production and delivery growth as Tesla hits full stride in China, develops its base in Germany and breaks ground on a new facility in Texas.
Morgan Stanley analyst Adam Jonas, who earlier this week lifted his price target on Tesla by $270 to $810 per share, sees the further development of production facilities in Austin as supportive for Tesla's manufacturing pace over the near term, with an upgraded total 2023 forecast of 1.7 million units and a 2030 estimate of 5.2 million units, a 38% increase from his prior estimate.
The Street's founder, Jim Cramer, thinks the biggest driver of Tesla's recent gains is linked to its inclusion on the S&P 500, where there are "plenty of funds that have to continue to buy it ... and as the stock goes higher, these index funds do not sell it. They let it ride."
Tesla, which closed with a market value of $773.5 billion last night, rose 4.5% in early Friday trading to change hands at $856.42, its third consecutive all-time high and a move that extends its S&P 500-inclusion rally, which began on Dec. 3, to around 50%.
Tesla, in fact, has outpaced bitcoin since the pandemic lows of early March, rising 757% compared with a 400% gain for the world's biggest digital currency.
Facebook closed with a market value of $765.5 billion last night on the Nasdaq.
Another factor in Tesla's 2021 gains, however, is linked to Democratic Party control of the Senate, following runoff elections in Georgia.
Both Tesla and the broader electric vehicle sector have jumped following the appointment of former Michigan Gov. Jennifer Granholm as energy secretary by President-elect Joe Biden.
Granholm, who has close ties to the auto sector following her two terms as governor, will need Senate confirmation to take up her post and work alongside Transportation Secretary appointee Pete Buttigieg.
Biden has promised to build 550,000 electric-vehicle-charging stations while creating some 1 million new jobs through investment in clean energy research.
One of Tesla's earliest investors, in fact, was the Energy Department itself, which issued a $465 million loan to Musk's nascent carmaker in 2010 to "produce specially designed, all-electric plug-in vehicles and to develop a manufacturing facility in Fremont, California, to produce battery packs, electric motors, and other powertrain components for powering specially designed all-electric vehicles," according to the government's website.