In the world of electric cars, the moment many enthusiasts have been waiting for has finally arrived. In October 2020, Tesla Inc., the company synonymous with electric cars, announced that they were going public. The move surprised the industry, as the company had managed to stay private for 13 years and had been valued at over $50 billion.
Investors, who had speculated on the potential of Tesla stock without the ability to invest, are now eagerly watching as the company moves onto the stock market. According to industry analysts, Tesla could be one of the most important and profitable companies to go public in the last decade.
Tesla wasn’t the first electric car company to go public. Nio in China, for example, has been listed in the New York Stock Exchange since 2018 and has since gained over 3 million orders for its vehicles. Even so, many investors look upon the Tesla announcement as a signal for the future of electric cars, as the company currently sells more electrical cars globally than any other manufacturer.
Tesla’s announcement is being taken as a positive one for the future of electric cars, although there are some analysts who caution that the stock price is too risky. Mark Spiegel, a hedge fund manager who specializes in technology investments, stated in a recent interview, “It’s the most speculative stock I’ve ever seen. It could skyrocket or crash and burn. Only time will tell which it will be. So caution would be warranted”.
Others within the industry are more optimistic of the potential of Tesla and its forthcoming stock. Philip Alster, editor at Large of Green Car Reports, was quoted as stating, “Rather than viewing Tesla as an automaker, it’s more accurate to think of them as a clean energy and advanced technology company. As such, investing in them is a bet on a clean energy revolution that is likely to only grow in the future”.
Despite the mixed reviews from analysts, the interest in Tesla remaining private no longer exists. Investors who had speculated about the company for years are now able to seize their chance for a slice of the action, whilst interest in the firm’s potential on the stock market is only set to grow further.
What Impact Could Tesla Have?
Tesla’s decision to go public could have a number of impacts. Most evident is their potential to accelerate the growth of the electric car industry itself. With their financial clout and the advantages of a public listing, Tesla could have the resources to move the industry forward in ways which smaller companies and research institutes simply cannot.
The impact could be even greater on the public consciousness of sustainability and the environment. With Tesla’s recent announcement, electric cars have been thrust into the public spotlight and given a sense of credibility that private firms cannot attain. Furthermore, Tesla’s entry into the market adds yet another household name to the industry and could further urge consumers to consider going electric.
Tesla has also proven that they are willing to expand their operations outside of the automotive sector. Tesla Energy, their home storage solutions business, is a case in point. With the recent announcement, there is potential that Tesla could expand their portfolio of businesses and provide more solutions to sustainability and green living.
What Benefits Could Investors Reap?
For the investors, the potential benefits are obvious. When Tesla went public, it means that the company’s shares are now open to the public and no longer restricted to only a select few. This gives investors both more opportunity and more risk.
The opportunity lies in the fact that the value of Tesla stock could rise dramatically in the short-term. This is amplified by the fact that the companies going public have been rigorously vetted, giving investors an objective view of what their investment could yield.
The risk comes from the fact that if the stock does not perform positively, investors could incur major losses. Sure, the stock market is a balancing act, but the relationless nature of it could mean that even bad investments could return positive returns.
What Does the Future Hold for Tesla?
There is no certainty of what the future holds for Tesla Inc., and the company’s stock could go in any direction. However, industry analysts have stated that they expect Tesla to remain a leader in the electric car market and to remain one of the premier companies in the sector.
This could potentially open up greater opportunities in the future, both in terms of innovation and potential collaborations. Some analysts have speculated that with their newfound public status, Tesla could become an even more attractive partner to other companies who may be interested in their technology.
Of course, the primary benefit of Tesla going public is the potential for investors to make significant profits. Some analysts have predicted that Tesla stock could reach $4,000 per share in the short-term, although that could depend on other external factors such as the state of the economy.
What Are the Risks for Tesla Investors?
For investors, there are a number of risks associated with Tesla stock. The primary one is that of volatility, as the value of stocks can change dramatically in a short-term period. This could be supplemented further by the fact that Tesla’s products are still relatively new. Electric cars are still a unique technology, and this could be both an advantage and a hindrance to Tesla’s success.
Another factor which may add risk to the stock is Tesla’s management. It’s no secret that Tesla CEO Elon Musk is a controversial figure, and his statements and actions have been known to tank Tesla stock. As such, investors should be aware that what may be perceived as simply a matter of good business could potentially be a monstrous risk to their investments.
What Factors Could Influence the Success of Tesla Stock?
The strength of Tesla’s stock performance could ultimately depend on a number of factors. Many analysts have noted that the success or failure of Tesla will hinge on the quality of its product, as well as the quality of its customer service and delivery. Further, any external economic factors could have a negative or positive effect on the stock price.
The execution of Tesla’s plans will also likely play an essential role. With the announcement of their public listing, the company has taken on a lot of responsibility, both to its customers and investors. They will now have to deliver on their promises of improved quality and customer service, as well as communicate the potential of its product to the public.
Finally, how Tesla interacts with the public and other companies will also likely factor in. So far their PR strategy has been largely positive, but that could easily change if the company acts irresponsibly or in an unethical manner.
How Does Tesla Compare to Other Electric Car Companies?
Tesla’s announcement has cast an increased public attention onto other electric car companies, which have since had to operate their own public listings. Nio, one of the biggest names in the industry, has also seen its stock soar as of late. It’s potential profits, as well as its recent partnerships with other industry leaders, have earned it the title of being one of the main competitors to Tesla.
But Tesla still reigns in the electric car market, with the ability to produce more cars in a quarter than any of its other competitors. With its plummeting prices and expansive lineup of vehicles, Tesla has the potential to leave its competitors playing catch up.
Little competitors in the electric car market have any chance of knocking Tesla off its throne in the short-term, nor do they have the required resources to compete directly with the company. Many of these competitors will have to focus their efforts on niche markets and market segments, a strategy which Tesla has adopted to great success.
Conclusion of the Move
Tesla’s move to go public has raised eyebrows in the industry and created a buzz amongst investors. Many look upon the move as a positive one, with the potential of significantly increasing the value of their investments. But caution is still required, as the volatility of Tesla stock could create both winners and losers.
Ultimately, only time will tell what the future holds for Tesla and the electric car market. What is certain, however, is that Tesla’s latest move has added yet another layer of excitement and potential to the industry, and that could be great news to investors and green enthusiasts alike.
