The world’s buzziest electric car company is now worth more than Facebook.
Tesla’s share price has skyrocketed over the past year, as the company has delivered five profitable quarters in a row. Its market capitalization is now hovering around $830 billion, making it the fifth most valuable company on Wall Street. Only Apple, Microsoft, Amazon, and Alphabet loom larger.
The company’s soaring stock price has some basis in reality. Tesla has been consistently profitable since the end of 2019. It’s expanding production with new factories in Austin, Texas and Brandenburg, Germany (although the German plant faces environmental hurdles). It sold nearly half a million cars in 2020—an impressive increase over the 367,500 cars it sold in 2019, but still a fraction of what rivals like Ford and GM deliver each year with much smaller market caps.
More immediately, Tesla’s stock price has benefited from the election of Joe Biden, and the results of this week’s Senate runoff elections in Georgia, which hand Democrats control of the White House and both chambers of Congress. That boosts the likelihood that Biden can enact his plans to create 1 million jobs in the US auto industry, invest in electric vehicle charging stations, and other green energy initiatives that could benefit Tesla’s bottom line.
Tesla has also benefited from a defiantly optimistic stock market that has lavished cash on any company that faintly smells of tech. Facebook benefited, too: Its stock rose 33% in 2020. But Tesla gained far more, watching its shares rise more than 700% in the past year—far above most analysts’ target price for the stock.
Tesla finally surpassed Facebook this week, just as the social media giant’s share price slumped slightly amid fears that unified Democratic government in the US could lead to greater antitrust scrutiny.
The gains are good news for Tesla’s stockholders, and one in particular: CEO Elon Musk this week eked past Amazon chief Jeff Bezos to become the new richest man in the world.
Musk has, in the past, bemoaned the fact that he is “cash poor” because most of his wealth is tied up in company stock. Still, the altruistic pauper took to Twitter amid the news of his company’s success to declare his intention to give away money.