Tesla capitalization exceeded $ 100 billion
Tesla Inc on Wednesday became the first publicly listed automaker in the United States to surpass the $ 100 billion market capitalization mark in a stunning rally that more than doubled its stock in the past three months..
The company, which is already priced higher than Ford Motor Co and General Motors Co combined, rose 4.8% to $ 573.20 in early trading, bringing Tesla’s market capitalization to over $ 103.12 billion..
This landmark historic milestone comes less than a month after Tesla shares surpassed $ 420, the price at which Elon Musk, according to his Twitter post last year, was going to buy back the shares of the electric car manufacturer and take the company private..
This was not destined to happen due to strong pressure from investors and problems from regulators..
Tesla’s market value also pushes Musk one step closer to securing the first tranche of $ 346 million in options from a record high compensation package..
Tesla’s board and shareholders approved a compensation plan for Musk in 2018, allowing him to earn options worth potentially in excess of $ 55 billion over the next decade..
Musk currently does not receive a salary, although he owns about 20% of the company..
In order to receive the payout, the company must hold its market cap above $ 100 billion long enough to reach a market cap of $ 100 billion at both 30-day and 6-month moving averages, according to regulations. The company must also achieve certain targets for annual income or EBITDA targets. The automaker will have to report either four-quarter revenue of $ 20 billion or EBITDA (excluding shares) of $ 1.5 billion.
This is all provided that this compensation plan is not canceled by the court..
Tesla shareholder Richard Tornetta is suing Elon Musk and the company’s board members in the Delaware Chancery Court, arguing that the remuneration is unreasonably high and the board’s decision to award Musk amounts to a breach of fiduciary duty.
The company’s stock, which is up more than 20% in 2020, has been rallying since Tesla reported its third-quarter earnings on Oct.23. The stock traded at around $ 250 prior to earnings release and rose to nearly $ 300 after the company reported unexpected profits.
Tesla continued to climb on China entry and Q4 shipments that beat Wall Street expectations.
The company managed to open its Shanghai plant ahead of schedule and begin shipping the Model 3 sedan to China in late 2019. The automaker reportedly ramped up production at its new Shanghai plant to over 1,000 vehicles per week.
The company is also moving forward with its plans to build a fourth plant in Germany, despite the company facing a local outcry over concerns about environmental concerns..
The company also wowed investors in early 2020 with strong fourth-quarter shipments. Tesla said it delivered 112,000 vehicles in Q4 to complete the year, bringing the total number of vehicles delivered in 2019 to about 367,500 vehicles, up 50% from 2018..
Tesla to report fourth quarter earnings on Jan.29 after markets close.
Musk – «one of our great geniuses and we must protect him», – Trump said in an interview with co-host «Squawk Box» Joe Kernen at the World Economic Forum in Davos, Switzerland.
«You know, we have to protect Thomas Edison, and we have to protect all these people who originally came up with the light bulb, the steering wheel and all these things. And he is one of our very smart people, and we want to cherish these people », – said the president.