Tesla’s stock can reach $3,000 by 2025 if it executes really well: Elon Musk
Electric car maker Tesla Motors CEO Elon Musk has announced that he has confidence in investment management firm Ark Invest’s recent prediction that EV giant’s market valuation will reach $3,000 per share by 2025. New York-based Ark Invest gave Palo Alto, California-based Tesla the aforementioned price target for 2025, believing that the automaker will be delivering 5 million to 10 million EVs per annum by then.
The predicted number of EV delivers represents a sharp increase from deliveries of 499,550 EVs in 2020. While Tesla has been working on improving its delivery capabilities but raising it to 10 times the current level would be difficult for the company.
Ark Invest’s Cathie Wood said in an interview, “Our estimate for Tesla's success has gone up. The main reason for that is their market share. So instead of going down from year-end 2017 to today, it has actually gone up fairly dramatically.”
With the predicted number of EV deliveries by 2025, Tesla will get a place right amongst the automotive elite in terms of mass production of vehicles. Currently, the EV giant’s stock is trading at around $733 per share. The stock has grown by more than 1,700 per cent within the last five years. Last year, in particular, was a remarkable year for the company’s sales as well as share price as the world accelerated its pace from the conventional internal combustion engines (ICEs) to EVs.
The second quarter (Q2) of this year, Tesla, for the very first time, manufactured and sold more than 200,000 EVs worldwide and achieved a record high profitability.
The high valuation predicted by Ark Invest is also due to their belief in the Tesla Network. They believe that the EV giant will not only succeed in increasing its sales numbers but also be able to deliver a fully autonomous ride-hailing network that will generate high profit margins.
Musk expressed belief in the investment management firm’s $3,000 price target, saying that the predicted price would become a reality if the company executes really well. It is interested to note here that in the past Musk has often told Tesla employees to ignore the company’s share price. Now, it appears that he truly believes in the potential of the brand.
With a market cap of more than $730 billion, Tesla is already the most valuable automobile manufacturer in the world. If the company’s stock really soars to $3,000 per share, it would become the most valuable company on earth, with an estimated worth of around $3 trillion.
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