Post-election surge has added $250bn to Tesla value, but analysts urge caution
Tesla’s post-election surge, powered by Elon Musk’s full-throated support for Donald Trump, has added almost $250 billion to the carmaker’s value, a staggering sum that now has some on Wall Street urging caution.
“The market’s reaction to Trump’s victory has been nothing short of explosive for Tesla, and while there’s certainly potential for benefits under a Trump administration, the current rally seems overheated in the short-term,” said Adam Sarhan, founder and chief executive officer at 50 Park Investments. Sarhan maintains his longer-term bullish view on the company.
Among these are Trump’s threats to reverse EV-friendly policies put in place by President Joe Biden, and the likelihood of a strained relationship with key market China. On a macro level, the possibility of higher inflation caused by some of the policies proposed by Trump may also be a sticking point. Tesla and other carmakers have already suffered a slump in sales in the past few years as consumers pulled back on big-ticket purchases.
Yu and Jonas both have a buy-equivalent rating on the stock and maintained their price targets in their latest notes.
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