How Tesla Stock Rebounded Back to Green After 40% Loss in 2024
EV king powered higher over the past couple months, charged on hopes of returning growth even as returning growth is nowhere to be seen. But does it matter? Let’s find out.
Tesla Erases 40% Drop in Electrifying Rally
Tesla stock (ticker:
TSLA) is on a tear. A powerful comeback has shut the haters’ mouths as the electric-car maker is up about 80% from its 2024 nadir back in April. In other words, more than $350 billion have been added to Tesla’s market cap in the span of a couple months.
What’s driving the electrifying charge in the popular auto maker, arguably the most popular? It’s a bunch of factors. But more than anything, it’s investors’ big expectations over returning growth after the car company’s shares were begging to be scooped up by bargain hunters.
Tesla stock had slumped about 40% on the year through late April while other big tech giants were busy logging records and getting AI drunk. Take Microsoft (ticker:
MSFT) or Nvidia (ticker: 
NVDA). Or any of the Magnificent Seven members. They’ve all been celebrated over prospects of artificial intelligence-driven gains.
The apparent disconnect between Tesla and the rest of the Mag 7 crew is no longer there. After stringing up a winning streak of eight straight days of winnings through Friday, Tesla shares managed to reel out of their deep 2024 losses and move in the green by about 1%.
Deliveries Fuel Investors’ Long Bets
Better-than-expected delivery figures underpinned the recent leg up. The Elon Musk-led company shipped 443,956 vehicles globally in the three months ended June, a 4.8% decline from the same quarter last year. And while this drop, the second one in a row, indicated that the business of deliveries didn’t grow, investors got excited about the consensus-beating numbers. Analysts anticipated 439,302 delivered units. It was also better than the first-quarter delivery figure of 386,810.
Optimism about artificial intelligence is also a key factor in steering the share price higher. It’s worth mentioning that Tesla, which recently started churning out profits, has decreased its production rate and manufactured about 411,000 vehicles in the last quarter. Lower production count translates to lower inventories, reduced costs and less pressure to cut prices in order to get rid of cars gathering dust in factories.
All that means the company could splurge some cash on other projects in the pipeline and a refresh of existing ones.
Elon Musk + AI + Promises = Profits???
The advance of robots and AI-powered assistants is among the top priorities for Elon Musk. Tesla’s second-generation humanoid robot Optimus debuted last week at Shanghai’s 2024 World AI Conference. First released in 2021, Optimus was designed as an everyday AI assistant to help out with things like carrying stuff, cleaning up and cooking. Before it’s launched to the public, Tesla plans to test it out in its factories starting in early 2025.
To this, Elon Musk had only one thing to do — slam the short sellers and send them into “obliteration.”
”Once Tesla fully solves autonomy and has Optimus in volume production,” Musk wrote on X, “anyone still holding a short position will be obliterated.” He went further to call out one specific Tesla permabear — Bill Gates.
Buyer Beware!
Now on to some concerning reality checks that can make you think twice before plowing your hard-earned money into the EV maker. Tesla’s fleet of vehicles is aging badly. The Model Y is just about to pop the confetti for its fifth birthday. A lack of innovation into Tesla’s best-selling models may strip some of the company’s brand recognition for slick-looking, ultra-modern EVs.
What’s more, Tesla faces fierce competition from the East. China’s biggest maker of electric cars BYD (ticker:
1211), sold a record number of electric and hybrid cars in the last quarter. And it’s threatening to overtake Tesla as the world’s top EV manufacturer.
In June, Tesla’s market share in China dwindled by a worrying 24% from a year ago while the broader sales numbers went up thanks to the rollout of cheaper EV alternatives. BYD’s sales rose 24% in the second quarter to 426,039 EVs.
We Want to Hear from You
Can Tesla continue its run and keep the profits flowing to fund its risky bets on AI? Judging by the share price increase, investors seem to think so. What do you think?
Let us know in the comments below.
Tesla Erases 40% Drop in Electrifying Rally
Tesla stock (ticker:
TSLA) is on a tear. A powerful comeback has shut the haters’ mouths as the electric-car maker is up about 80% from its 2024 nadir back in April. In other words, more than $350 billion have been added to Tesla’s market cap in the span of a couple months.What’s driving the electrifying charge in the popular auto maker, arguably the most popular? It’s a bunch of factors. But more than anything, it’s investors’ big expectations over returning growth after the car company’s shares were begging to be scooped up by bargain hunters.
Tesla stock had slumped about 40% on the year through late April while other big tech giants were busy logging records and getting AI drunk. Take Microsoft (ticker:
MSFT) or Nvidia (ticker: NVDA). Or any of the Magnificent Seven members. They’ve all been celebrated over prospects of artificial intelligence-driven gains.The apparent disconnect between Tesla and the rest of the Mag 7 crew is no longer there. After stringing up a winning streak of eight straight days of winnings through Friday, Tesla shares managed to reel out of their deep 2024 losses and move in the green by about 1%.
Deliveries Fuel Investors’ Long Bets
Better-than-expected delivery figures underpinned the recent leg up. The Elon Musk-led company shipped 443,956 vehicles globally in the three months ended June, a 4.8% decline from the same quarter last year. And while this drop, the second one in a row, indicated that the business of deliveries didn’t grow, investors got excited about the consensus-beating numbers. Analysts anticipated 439,302 delivered units. It was also better than the first-quarter delivery figure of 386,810.
Optimism about artificial intelligence is also a key factor in steering the share price higher. It’s worth mentioning that Tesla, which recently started churning out profits, has decreased its production rate and manufactured about 411,000 vehicles in the last quarter. Lower production count translates to lower inventories, reduced costs and less pressure to cut prices in order to get rid of cars gathering dust in factories.
All that means the company could splurge some cash on other projects in the pipeline and a refresh of existing ones.
Elon Musk + AI + Promises = Profits???
The advance of robots and AI-powered assistants is among the top priorities for Elon Musk. Tesla’s second-generation humanoid robot Optimus debuted last week at Shanghai’s 2024 World AI Conference. First released in 2021, Optimus was designed as an everyday AI assistant to help out with things like carrying stuff, cleaning up and cooking. Before it’s launched to the public, Tesla plans to test it out in its factories starting in early 2025.
To this, Elon Musk had only one thing to do — slam the short sellers and send them into “obliteration.”
”Once Tesla fully solves autonomy and has Optimus in volume production,” Musk wrote on X, “anyone still holding a short position will be obliterated.” He went further to call out one specific Tesla permabear — Bill Gates.
Buyer Beware!
Now on to some concerning reality checks that can make you think twice before plowing your hard-earned money into the EV maker. Tesla’s fleet of vehicles is aging badly. The Model Y is just about to pop the confetti for its fifth birthday. A lack of innovation into Tesla’s best-selling models may strip some of the company’s brand recognition for slick-looking, ultra-modern EVs.
What’s more, Tesla faces fierce competition from the East. China’s biggest maker of electric cars BYD (ticker:
1211), sold a record number of electric and hybrid cars in the last quarter. And it’s threatening to overtake Tesla as the world’s top EV manufacturer.In June, Tesla’s market share in China dwindled by a worrying 24% from a year ago while the broader sales numbers went up thanks to the rollout of cheaper EV alternatives. BYD’s sales rose 24% in the second quarter to 426,039 EVs.
We Want to Hear from You
Can Tesla continue its run and keep the profits flowing to fund its risky bets on AI? Judging by the share price increase, investors seem to think so. What do you think?
Let us know in the comments below.
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