If you watched Tesla stock price history, Tesla stock price has plummeted more than 33% in the past month and 40% since the beginning of the year. In early April Tesla was trading at $1,145, but now the stock is trading at $664. Because of this, many people are even interested in dollar-to-pound currency exchange rates; because of such a collapse on the stock market, the dollar may fall in price.
According to some Western mass media, many investors began to use their rights of early sale of the company’s shares, and that’s not counting stock market speculators. In other words, the fall in the value of the concern’s shares makes investors want to sell them as quickly as possible, which in turn only accelerates the fall in prices. Such speculation is even more profitable than trading currencies using the Universal Currency Converter Calculator.
Tesla after hours stock price: what happened?
A lot of factors not directly related to the company caused the drop in stock prices. It all started with the announcement of Ilon Musk’s purchase of Twitter. At the time, Musk was the richest man on the planet, but that wealth itself was contained in Tesla stock.
To amass the necessary dollar amount to buy Twitter, Musk was forced to start selling Tesla stock, thereby triggering its decline. Several other negative things happened next, including an accusation of sexual harassment against Musk himself. After that, Tesla’s stock prices plummeted.
The head of the company rejected them, offering to prove the accusations false by the fact that the alleged harassment victim does not know and cannot know what tattoos and scars he has on his body. But that didn’t save Tesla’s stock from another 10% drop late last week.
So what does all this mean?
Tesla is the most expensive car company in the world. It is hard to compare it to Amazon stock prices after hours today, and yet it is one of the largest companies. Even after a 40% drop in its stock price, Tesla is worth more than three times as much as Toyota. At the same time, Toyota sold ten times as many cars as Tesla did last year.
Such a high value for Ilon Musk’s concern is based on investors’ expectations of further sales growth, not on current performance. Yes, Toyota is selling more, but its sales are not growing; its plants are half-utilized, and its prospects are dim. Tesla’s sales are growing rapidly; there are year-long lines for electric cars, and its plants are overloaded (and new ones are being built).
But with the company’s value based not on real assets, but on expecting future wins, shares can fall quickly, and briefly. Fluctuations in their price can be measured in tens or even hundreds of percent over a short period.
What’s really up with Tesla?
The company is showing record profits and is rapidly increasing production and sales. The automaker’s stock price growth is more dynamic than Amazon’s US stock price today. There is enough money earned to invest in building new plants. Simply put, objectively, Tesla is doing better than any other automaker.
Falling stock prices would be a problem if Tesla had to sell its securities to attract investment. But the company doesn’t need investment now, because it has enough of its own funds for development.
As a result, only shareholders and, mostly, Ilon Musk personally suffer from the drop in stock prices so far. Only last Friday, his fortune dropped by $10 billion, although he remains the richest man in the world.