How Tesla Has Broken $2000 a Share and Is it Too Late to Get in?

by Laura Brafford Finance Executive

Just a month ago, many financial analysts and top stock brokers believed Tesla’s share wouldn’t go beyond $1,000. Some analysts even stated Tesla’s share price would peak at around $1,200 then come down.

Surprisingly, Tesla’s share price went beyond all these predictions to the chagrin of most naysayers. It has been on a steady rise, and it extended its rally last week when it spiked resolutely above $2,000 for every share. This is a new record, and it happened just ahead of the planned 5 to 1 share split and the anticipated inclusion of Tesla (TSLA) in the GSPC (S&P Index).

In terms of percentages, Tesla’s share price shot up by 7%, setting a new record and making it the priciest stock on Wall Street. To be precise, Tesla rose to a record of $2021.83/share last week, before it shed off some amount and closed at $2001.

Elon Musk, Tesla’s CEO and a fecund voice on social media who’s known for his controversies with investors and regulators, is in cloud nine as Tesla jumps to higher pedestals.

It is unbelievable that this clean energy car manufacturer, which, just last year, was reeling under devastating pressures from investors, analysts, and even the top brokers, is now sitting on a market capitation amounting to $400 billion. This dwarfs the capitation of many deep-rooted auto-manufacturing competitors such as BMW (The luxury car manufacturer from Germany), Ford, and General Motors.

Already, some traders who invested in Tesla’s shares early this year through the best online trading platforms have made some cash by selling their shares. Some are still holding onto the shares just in case the prices continue rising.

Tesla has been performing remarkably well, and even in its second quarter, it delivered more units than expected. It appears that the coronavirus pandemic never had a serious impact on this electric car maker, save for its factory at Fremont that was shut down briefly because of the COVID-19 pandemic.

Tesla has beaten all the odds because there is an increase in demand for its electric vehicles, both internationally and domestically. In fact, the company has been enjoying about 82% of the electric car market share in the U.S. for the past six months. Whether this will change or not is difficult to tell.

According to the data obtained from Buy Shares, Tesla sold over 70,000 units, most of which were the booming Model 3.

The fact that the demand for Tesla’s EVs has been on the rise made Wedbush Securities predict that Tesla will continue dominating the Chinese market and is likely to sell about 150,000 units within this year. Wedbush Securities is the same company that, earlier last week, predicted that Tesla’s shares would sell at 1,900, and it came to pass.

Is it too late to buy Tesla’s Shares?

A quick look at the websites of the best international stockbrokers will reveal the fact that a lot of discussions are going on so far as Tesla’s shares are concerned.

The discussions border on whether it is the right time to buy Tesla’s shares or to ignore them. Some experts argue that, since the share price has hit a new high, short-term investors may not benefit from it, as the prices are most likely to come down.

David Trainer, an investment research specialist and the CEO of New Constructs, agrees with this sentiment. He said that, with time, investors will start feeling the competitive disadvantages, and Tesla’s share prices will be knocked down to $250/$300 per share soon. At this point, long-term investors will take advantage of the low prices and scoop the shares and hold them.

Even today, many long-term investors aren’t bothered by the small fluctuations in Tesla’s share prices. This is because they believe, whatever happens, Tesla’s share price will have a generally positive trend.

For example, Catherine Wood, a money manager, told CNBC that she expects Tesla’s share prices to reach $7,000 per share in the next five years. If that’s anything to go by, many long-term investors would now be looking for the best broker for buy and hold so they can reap big in the future. Catherine is the CEO and founder of Ark Investment Management.