Tesla's Stock Keeps on Flying After Hitting $1 Trillion Market Value

Since election day, Tesla's stock has soared over 26%, augmenting Musk's personal fortune by $50 billion, pushing it to a staggering $313.7 billion. This financial upsurge has made Tesla the ninth-highest market value among U.S. stocks, with just $10 billion needed to overtake TSMC.

Elon Musk's business empire, predominantly centered around Tesla, is deeply exposed to the whims of government policies and regulations. The relationship between Musk's enterprises and the government has been complex and multifaceted. Over the years, Tesla has benefited from government subsidies, which have supported its growth and expansion. However, it has also been subjected to rigorous governmental scrutiny, facing investigations into its safety protocols and labor practices. Despite these challenges, Tesla remains committed to pushing forward its cutting-edge, fully automated self-driving technology, which is currently under intense regulatory review.

Edward Lees from BNP Paribas Asset Management pointed out Musk's unique position as a bridge between the tech community and Washington following Trump's electoral victory, underscoring his potential to influence policies that significantly affect his myriad business interests.

Musk's influence might even extend to reshaping federal agencies that regulate and investigate his firms, including Tesla, SpaceX, and X. His push for a streamlined federal approval process for fully autonomous vehicles demonstrates his effort to minimize bureaucratic obstacles to innovative automotive technologies.

Musk has long promised that Tesla will soon deliver "full self-driving" capabilities. In the Q3 earnings call, he outlined plans to seek regulatory nods for a Tesla ride-hailing service in Texas and California by 2025, with potential expansions soon after. He has frequently noted that government regulation is the key uncertainty in deployment timelines.

Although Trump previously criticized the Biden administration's EV policies, his perspective shifted following Musk's endorsement, transitioning from strong criticism to occasional commendation of electric vehicles. This change reflects Musk’s increasing influence on policy decisions affecting the electric vehicle sector and his broader business operations.

At a rally in Atlanta, Trump expressed his support for electric vehicles, stating, "I'm for electric cars, I have to be, because Elon endorsed me very strongly."

Wedbush's Dan Ives raised his price target on Tesla to $400 up from $300. He suggests that a Trump win could add significant value to Tesla's stock, predicting the company's market cap could exceed $1 trillion if advancements in autonomous driving accelerate. Tesla's ambitions in robotaxi technology could be propelled forward under the Trump administration. CFRA's Garrett Nelson highlights that Trump’s victory might expedite regulatory approval for autonomous driving, boosting Tesla's robotaxi initiatives.

However, investors are advised to exercise caution as Tesla’s stock appears overbought, with a current 6-day RSI of 87, suggesting a potential detachment from its short-term fundamentals.