If You Invested $1000 In Tesla At Its January Lows And Stock Returned To Record Highs, Here's How Much You'd Have

Tesla, Inc. TSLA has been one of the biggest comeback stories of this year. Bruised and ravaged by the economic impact of successive interest rate hikes, the stock slumped 65% in 2022.

From then on, things began looking up for the Elon Musk-led company but not before an early scare.

The Resurgence: Despite facing supply-chain challenges during the COVID-19 pandemic, Tesla shares remained resilient, reaching a record high of $414.50 (split-adjusted) on Nov. 4, 2021. 

However, the company encountered economic headwinds as inflation spiked and the Federal Reserve raised interest rates to address the flailing economy. 

This led to reduced consumer spending, particularly on pricier electric vehicles like Tesla’s. Additionally, rising competition in the EV market further impacted Tesla’s volume. 

Tesla’s stock hit a low of $104.64 on Jan. 3, following a delivery setback. As a result, Tesla experienced lower volume. In response, the company leveraged its global production capabilities and extensive scale to aggressively reduce the prices of its electric vehicles, igniting a price war in the industry. These strategic price cuts, along with discounts and promotions in various regions, successfully revitalized volume and reversed the stock’s downward trajectory.

See Also: Everything You Need To Know About Tesla Stock

Returns From Tesla: If you invested $1,000 in Tesla when the stock was at its Jan. 3 bottom of $104.64, you would have had 9.56 shares. The same would be worth $3,962.62 if the stock retuned to its all-time high of $414.50. This translates to a roughly 300% return.

Chart Courtesy of Benzinga Pro

Future Perfect: Despite ongoing challenges, analysts remain optimistic about Tesla’s long-term prospects, citing its partnerships and the upcoming Cybertruck launch as key factors. 

Analysts also highlight the potential of Tesla’s full-self driving software and licensing opportunities to drive profit margins. 

However, critics argue that increased competition may dampen Tesla’s growth, pointing to Ford’s F-150 Lightning price cuts as a sign of potential plateauing EV adoption. Controversies surrounding Tesla’s FSD and doubts about its wider rollout also loom. Nevertheless, Tesla continues to hold a dominant position in the EV market, at least for now.

Deepwater Asset Management’s Gene Munster said even if Tesla holds on to 10% of the market share when the auto market goes all EVs, it would have a $1.1 trillion business in a decade. 

Price Action: Tesla stock has soared 138% so far this year. On Tuesday, the stock settled at $293.34, up 1.02%, according to Benzinga Pro data.

Check out more of Benzinga’s Future Of Mobility coverage by following this link.

Related Link: Is Tesla The New Apple? Fund Manager Says Elon Musk’s Company Will Be ‘Much, Much Bigger’