Tesla shares sink 8%, giving up some gains from post-election pop
PUBLISHED WED, DEC 18 20244:59 PM ESTUPDATED WED, DEC 18 20245:47 PM EST
Lora Kolodny
@IN/LORAKOLODNY/
Ari Levy
@LEVYNEWS
WATCH LIVE
KEY POINTS
Tesla shares dropped more than 8% on Wednesday, their biggest decline since before Trump’s election victory.
The stock is still up 75% in the six weeks since the election and climbed to a record on Dec. 11, surpassing its prior high reached in 2021.
“Most investors we speak to have been stunned by the magnitude of the rally,” analysts at Barclays wrote in a note on Wednesday.
TECH
Tesla shares sink 8%, giving up some gains from post-election pop
PUBLISHED WED, DEC 18 20244:59 PM ESTUPDATED WED, DEC 18 20245:47 PM EST
Lora Kolodny
@IN/LORAKOLODNY/
Ari Levy
@LEVYNEWS
WATCH LIVE
KEY POINTS
Tesla shares dropped more than 8% on Wednesday, their biggest decline since before Trump’s election victory.
The stock is still up 75% in the six weeks since the election and climbed to a record on Dec. 11, surpassing its prior high reached in 2021.
“Most investors we speak to have been stunned by the magnitude of the rally,” analysts at Barclays wrote in a note on Wednesday.
His new role could give Musk, who also runs SpaceX and owns social media company X, influence over federal agencies' budgets, staffing and the ability to push for the elimination of inconvenient regulations. Musk said during a Tesla earnings call in October that he intended to use his sway with Trump to establish a "federal approval process for autonomous vehicles."
While Tesla still doesn't produce robotaxis or operate driverless ride-hailing services, its major domestic competitor Waymo on Wednesday said it conducted over 4 million paid robotaxi trips in 2024 as it scaled its commercial operations in the U.S.
"Tesla is the only Elon Musk company that is publicly traded and it has often served as a proxy for an investment in Musk himself," the Barclays analysts wrote. "This value has understandably increased, but this further exacerbates the already-high key man risk in Tesla stock, in our view."
On Wednesday, a Quinnipiac poll found 53% of voters in the U.S. do not approve of Musk "playing a prominent role in the Trump administration." The split was massive across party and gender lines — only 31% of women surveyed said they approved of Musk taking a big role in the next administration, and only 5% of Democrats approved.
Musk has also complained in recent days that the SEC has issued a "settlement demand" tied to his sale of Tesla shares in 2022 as he was pursuing the purchase of Twitter, now known as X.
A spokesperson for the SEC declined to discuss the matter, telling CNBC that the agency conducts probes "on a confidential basis to preserve the integrity of its investigative process."
Tesla is due to report its fourth-quarter and year-end vehicle deliveries in January. Without a major new vehicle added to its lineup since Cybertruck deliveries began in November 2023, Tesla has been working to drive sales of its EVs with an array of incentives, like 0% financing.
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