Tesla has rejoined the $1 trillion market cap club, marking a strong recovery since Q3 2024. Key drivers behind this rally include Trump’s election victory and Tesla’s better-than-expected earnings report. Despite significant stock volatility this year, Tesla’s recent rebound is impressive, with Q3 earnings exceeding expectations and boosting its market cap by $150 billion. Trump’s victory also spurred a 29% surge in Tesla’s stock, its best weekly performance since January 2023.
Impact of Trump’s Victory
Tesla’s stock rise isn’t just coincidental. While some worry that Trump’s policies could hurt the EV sector, particularly by removing tax incentives, Tesla stands to benefit.
Tesla’s dominant position in the electric vehicle market gives it a competitive edge even without government subsidies. Trump’s promise to raise tariffs on Chinese EV manufacturers could limit the market entry of lower-cost Chinese brands like $BYD(002594)$ and $NIO(NIO)$ in the U.S. Additionally, Tesla CEO Elon Musk’s support for Trump could accelerate regulatory approvals for Tesla’s self-driving technology.
Strong Earnings and Future Outlook
Tesla reported its largest quarterly profit in over a year and offered an optimistic outlook for 2025. In Q3 2024, adjusted earnings per share (EPS) of 72 cents exceeded the expected 58 cents, with a 9-cent increase from the previous year. While revenue grew 8% year-over-year to $25.18 billion, it slightly missed expectations.
Tesla has regained delivery growth, with Q3 deliveries being the third-highest in company history. Musk projects a 20% to 30% growth in vehicle sales by 2025 and plans to launch a new entry-level car under $30,000. Tesla is also focused on increasing production and expects its Cybertruck to be profitable by year-end.
Tesla's Valuation and ETF Investment Options
Tesla’s P/E ratio of 131 is much higher than the automotive sector’s 12.76, but if Trump’s policies help drive growth, the valuation may be justified.
For those interested in investing in Tesla, ETFs focused on Tesla-related stocks offer a good option. Here are some ETFs with significant Tesla exposure:
$Direxion Daily TSLA Bull 2X Shares (TSLL)
T-REX 2X Long Tesla Daily Target ETF (TSLT)
$GraniteShares 2x Long TSLA Daily ETF (TSLR)
$Tradr 1.5X Long TSLA Weekly ETF (TSLW)
GraniteShares 1.25x Long TSLA Daily ETF (TSL)
These ETFs offer varying levels of leverage, from 1.25x to 2x, allowing investors to amplify returns based on Tesla's daily or weekly performance.
Conclusion
Tesla’s return to a $1 trillion market cap presents new investment opportunities, particularly driven by strong earnings and Trump’s victory. For those optimistic about Tesla’s future, ETFs offer a convenient way to invest, with the added potential for leveraged returns. However, with Tesla’s high valuation, investors should carefully consider their risk tolerance before investing.
$特斯拉(TSLA)$ $Direxion Daily TSLA Bull 2X Shares(TSLL)$ $T-REX 2X LONG TESLA DAILY TARGET ETF(TSLT)$ $GraniteShares 2x Long TSLA Daily ETF(TSLR)$ $Tradr 1.5X Long TSLA Weekly ETF(TSLW)$ $GraniteShares 1.25X Long TSLA Daily ETF(TSL)$
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