Tesla Inc. TSLA has seen its stock price climb by 7.23% in pre-market trading on Monday, as per Benzinga Pro. This follows the company’s achievement of a $1 trillion market capitalization last Friday, marking a significant milestone for the electric vehicle giant.
What Happened: The surge in Tesla’s stock price comes despite hedge funds suffering substantial losses from short positions. These losses have reached $5.2 billion from election day through the close of trading last Friday. The financial setback for hedge funds is linked to the close relationship between President-elect Trump and Tesla CEO Elon Musk.
Data from S3 Partners indicates that many hedge funds had already reduced their short positions on Tesla in the months leading up to the election. This strategic adjustment coincided with Musk’s public endorsement of Trump on July 13. However, those who continued to hold short positions have faced significant financial losses.
Meanwhile, Wedbush analyst Dan Ives on Monday raised his price target on Tesla from $300 to $400, in the hope that Donald Trump winning the Presidential election will be a “gamechanger” for the EV giant spearheaded by billionaire Musk.
Why It Matters: The ongoing rally in Tesla’s stock price is noteworthy, especially in the context of the recent U.S. Presidential election. Analysts from Wedbush have suggested that a victory for Donald Trump could be a “potential positive” for Tesla. While a Trump win might negatively impact the broader electric vehicle industry by potentially eliminating rebates and tax incentives, Tesla’s unmatched scale and scope in the EV sector could allow it to thrive.
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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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