Tesla shares finally snap record 13-day win streak that added $200B in value

During the streak, Tesla shares rose by more than 40%, boosting its market value to roughly $814 billion. The gain in market capitalization during the run came to nearly $240 billion – or more than the entire value of Japan’s Toyota, the second-most valuable automaker worldwide.

The rally was kicked off by news of the adoption of Tesla’s charging system by legacy U.S. automakers Ford and General Motors. This effectively puts 60% of the U.S. electric vehicle market on the North America Charging Standard (NACS) used by Tesla, even though there are other competing charging systems used around the world.

The electric carmaker’s stock price is still far beyond Wall Street’s forecasts, sitting 28% higher than the median target of $200 among Wall Street analysts, according to Refinitiv data.

“What has changed for the Street over the last month is the recognition with the Ford and GM supercharger partnerships that Tesla’s sum-of-the-parts valuation is now finally starting to get tapped into,” Wedbush Securities analysts wrote in a note.

With this rally, the company’s stratospheric price-to-earnings ratio far surpasses other automakers. Tesla’s forward price-to-earnings ratio is around 62, just below the 63.7 level sported by Amazon.com

By contrast, Ford and GM have P/Es of 8.2 and 5.6, respectively, according to Eikon data.

Wedbush compared Tesla’s share gains to Amazon, which for years defied many investor expectations that its stock would eventually fall. Tesla shares slumped in 2022, losing 65% of their value, and helping the shorts make a mint.

The 13-day rally cost short sellers more than $7 billion in mark-to-market losses, taking year-to-date losses to nearly $12.7 billion, according to S3 Partners.