Tesla Motors stock was lower to start a new day of trading because trees don't grow to the sky.
Shares of the electric vehicle maker were down 1.5% a share in premarket trading Tuesday while S&P 500 and Dow Jones Industrial Average futures were down about 0.2%.
Coming into Tuesday trading, Tesla stock rose for five consecutive days, gaining about $107 per share, or 44%, over that span, adding an incredible $344 billion to the company's market value.
The presidential election was the catalyst for the move. Tesla CEO Elon Musk backed Donald Trump and many Wall Street analysts expect the relationship to yield some benefits for Tesla over time. Wedbush analyst Dan Ives initially estimated that a Trump victory could add up to $50 to Tesla's stock price. Monday, he raised his target price by $100 to $400 a share while keeping his Buy rating.
Tesla stock, however, has added more than Ives' $100 hike since the election, and shares look overbought. That's a term used by stock market traders that looks at average gains and losses over a fixed period. Overbought essentially means that a stock has gone up a lot quickly.
That suggests shares could be due for a pause. That isn't all bad. Stocks don't go up every day and it's a chance for investors to catch their breath.
Coming into Tuesday trading, Tesla stock was up 38% year to date. All of that gain, and then some, was generated in the past few days.
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