Tesla stock on Monday had its best day in more than two weeks, finishing up 4.4% and outpacing all other stocks in the Nasdaq 100. In early trading, Jim Cramer commented on Tesla stock in an interview by Jeff Marks from TheStreet Live.

After sharing his thoughts on Virgin Galactic and founder Richard Branson's successful flight, Cramer stated, “Tesla is a huge buy right here. Virgin Galactic, not so much.” While some investors might have concerns about Musk’s testimony on Tesla’s acquisition of Solar City, Cramer believes “it is a nonissue when it comes to the stock.” Furthermore, “[Musk] will even be able to demonstrate [SolarCity] had some value,” Cramer believes.

Citing the current political climate, Cramer currently sees solar as “the right place to be” with Jeff Marks adding SolarCity was "ahead of its time." 

Featuring: Tesla Solar Roof

Featuring: Tesla Solar Roof

Tesla to $1,200?

This isn’t Cramer’s first comment on Tesla stock this year. Following record Q1 deliveries earlier this year, Cramer saw Tesla rising over 50% to $1,000 as “aggressive but not out of the ballpark”. At that time, Tesla was trading at ~$661 which, despite the volatility, is relatively close to Monday's closing price of ~$685. Following Q2’s record quarter, Cramer also mentioned he would rather buy Tesla’s stock over GM's stock.

Why is Musk Testifying?

SolarCity was acquired by Tesla for $2.6 billion in 2016. Although 85% of Tesla shareholders voted in favor of the acquisition, some shareholders believed this was a bailout for SolarCity. At that time, Musk owned ~22% of SolarCity leading some to believe he also sought personal gain in the acquisition. These factors led disgruntled shareholders to take legal action. In late 2020, Tesla board members agreed to settle the original lawsuit for $60 million. However, Musk refused the settlement and chose to defend Tesla’s acquisition of SolarCity in court. The trial is expected to take multiple weeks, and a decision could follow month's later.


Disclosure: Rob Maurer and Brennan Ertl are long TSLA stock and derivatives.