Tesla shares hit fresh swing highs and rose to $779 apiece yesterday. A new bullish cycle of one of the most controversial companies in the world could rest on the fundamental background. Besides, the rally could be propelled by new investors buying the shares. They firmly believe that Tesla will become something like Apple Inc. or even surpass it sometime in the future. Speaking about market capitalization, Tesla is likely to catch up Apple Inc. in the near time in terms of its market value. The thing is that Apple manufactures mainly smartphones, gadgets, and hardware. Lately, the company is actively promoting various services as well as invests in innovative projects. There are rumors that Apple Inc. is about to enter the market of electric vehicles. Nevertheless, most consumers consider the company to be the manufacturer of iPhones and tablets. Unlike Apple, Tesla is the company at a global scale with Elon Musk at the helm. This hi-tech mogul sets much broader aims than manufacturing smartphones. His other company, Space X, launches spacecraft. So, it would be right to say that Tesla owes its success to a variety of factors such as growing popularity of electric cars, the genius of Elon Musk, and progress of Space X. These factors lie behind a 10-fold climb of Tesla shares in 2020. Meanwhile, Tesla produces and sells fewer cars than any of the top 10 auto manufacturers.
Here comes a paradox. Tesla is much more valuable than any auto manufacturer, but at the same time, Tesla produces much fewer cars than any auto manufacturer. In other words, Tesla Inc. earns much less profit than any other auto manufacturer. Nevertheless, its market capitalization has been swelling like hell. Here is how the stock market operates. That company whose shares are in demand with investors is increasing its market capitalization. There is no secret. According to the latest corporate report, Tesla closed Q1 2021 with financial results slightly better than expected. This drove another rally of its shares. Analysts reckon that Tesla will scale up deliveries of its electric cars. So, they expect Tesla to sell 1 million cars per year in the near future.
Apart from the main direction, analysts predict success in undervalued kinds of business like solar energy technologies and production of car batteries. According to expert estimates, Tesla shares could surge in value to $1,100 apiece in 2021. Besides, Tesla is expected to gain $8 billion earnings only in the energy sector. Importantly, at present, Tesla deals not only with electric cars manufacturing. The lion's share of the company's revenue is not generated by car sales. Moreover, the most expensive Tesla models do not enjoy demand anywhere in the world. The company sells mainly the cheapest models like Model 3 and Model Y.
In terms of technical analysis, the shares have surpassed the important level of $708. Currently, the US benchmark stock indices are rallying day by day. In this context, only large high-tech companies are going to attract new investors. All in all, Tesla shares are expected to extend a climb towards one-year highs at about $900.
