Tesla’s stock closed at a record high of $ 2,000 on Thursday, pushing the company’s market capitalization to $ 370 billion. Tesla has been at a rally of the week since announcing a five-for-one stock split. The split will be distributed to anyone holding the fair tomorrow – Friday, August 21st.
A little over two months have passed since Tesla’s stock first reached $ 1000 per share. Last month, Tesla announced a solid second-quarter profit of $ 104 million. It was the fourth straight quarter of profit.
That allowed Tesla to qualify for inclusion in the S&P 500 stock index. If Tesla wins a slot in the S&P 500, funds that follow the index would need Tesla shares. This could push up the share price even further.
However, it is not clear what triggered the rally of the last few days. Tesla started the week at around $ 1,680. No major positive developments for the company were announced this week.
One factor may simply be spiraling public enthusiasm for electric car manufacturers in general. Tesla rival Nikola had a successful initial public offering in June; the company is now valued at $ 15 billion. A Chinese electric car manufacturer called Li Auto raised $ 1 billion last year in a public offering initiative.
Another little-known electric car manufacturer, Canoo, plans to go public through an alternative to an IPO called a special takeover company. Tesla rival Rivian has raised $ 5 billion from private investors over the past two years.
None of these companies has achieved nearly as much as Tesla; it is widely believed that investors’ interest in these companies is based on the hope that one of them will become “the next Tesla”. But because money goes into these Tesla rivals has this, may have inspired investors to revisit the original.
