Tesla hit $1 trillion market cap earlier this week following news that Hertz is ordering 100,000 vehicles to strengthen its electric vehicle rental fleet by the end of 2022. Strong sales in Europe along with bullish analyst predictions further boosted Tesla’s stock price. Morgan Stanley’s Adam Jonas raised his price target on Tesla to $1,200 a share from $900 on Sunday and Piper Sander’s Alex Potter has raised his target for the stock to $1,298 per share. News of the deal with Hertz has brought Tesla’s stock to $1,040 a share, a new record high. Breaking up its previous high of $900 a share reached back in January this year. The company has now joined tech giants Apple, Amazon and Microsoft in the $1 trillion market cap bracket.
It is the single largest purchase ever for electric vehicles and will represent about $4.2 billion in revenue for Tesla. The electrification plan from Hertz will eventually account for almost all of Hertz’s half-million cars and trucks worldwide. It is the company’s first big move since emerging from bankruptcy in June this year. And it highlights that Hert’z new owners, Knighthead Capital Management and Certares Management, are intent on shaking up the industry which hasn’t seen much change in the past.
After the surge in Tesla’s share price, Elon Musk added more than $36 billion to his fortune and is looking more likely to become the first person to reach a net worth of $300 billion. His $289 billion now puts him almost $100 billion ahead of former world’s richest man Jeff Bezos. Musk’s net worth if now so large that it has surpassed the market cap of the world’s second-largest car maker, Toyata, which is valued at £283 billion.
Tesla is currently on its longest streak of profitability in its 18 year history, with nine consecutive quarterly profits under its belt after last week’s earnings report. The automaker delivered 241,300 vehicles in the period ending 30th September.
