Tesla Net Worth: How Much Is Tesla Worth & Is It Worth Investing?
Tesla is the electric car company that is probably equally well known for its exciting lineup of products and its outspoken CEO, Elon Musk. Yet, the company has proven to be a huge success and is ranked No. 100 on the Fortune 500 list. Tesla turned a profit for the first time in 2020, and the company is an undisputed Wall Street darling.
To see how much Tesla is worth, take a look at this snapshot of the company’s current state, along with a discussion of the company’s history, value and future outlook.
|Headquarters||Palo Alto, California|
|Founders||Elon Musk, Martin Eberhard, Marc Tarpenning, Ian Wright, JB Straubel|
|CEO Elon Musk’s Salary||$0|
|What Tesla Is Worth|
|Share Price, 52-Week Range||$539.49-$1,243.49|
|GOBankingRates’ Evaluation of Tesla’s Net Worth||$58.04B|
Tesla’s Market Cap: $956.51
Market capitalization is simply the number of outstanding stock shares a company has issued times its current market price. Market cap does have its drawbacks as an evaluation method, however. For starters, market cap changes frequently, and it’s closely tied to the company’s current share price. It doesn’t take into account any of the direct financial metrics of the company, such as earnings per share, growth rate or book value.
Tesla’s share price saw astronomical growth last year, soaring as high as $1,243.49, thanks to strong third-quarter 2021 earnings and news that Hertz would purchase 100,000 Tesla vehicles for its rental car fleet. These events pushed the company’s capitalization above $1 trillion for the first time and made Tesla one of a handful of companies to have achieved that valuation.
The stock is currently trading for nearly 35% less than that 52-week high, reducing Tesla’s market cap to $956.51 billion, but not because of disappointing earnings. Tesla’s fourth-quarter revenue was up 65% compared to the same quarter in 2020, to $17.72 billion. Analysts had predicted $16.57 billion in revenue, according to CNBC. At $2.52 per share, earnings came out ahead of analysts’ $2.36 prediction.
The stock sell-off began after Musk sold shares in response to a Twitter poll, although it’s likely that his actual intent was to cover tax on stock options he had exercised. Moving forward, as Forbes contributor Peter Cohan pointed out, “Tesla stock is likely to enjoy a generally upward cast — with inevitable ups and downs — as long as Tesla keeps exceeding those aggressive growth targets.” However, Cohan reminded investors that Musk could have another big tax bill due in 2027.
Tesla’s Net Worth: $58.04B
Methods of determining the value of a company are wide and varied, each with its own merits and blind spots. The GOBankingRates company net worth is a more conservative valuation than most, taking into account only full-year profits and revenue from the last three years and the company’s assets and debts.
Tesla’s net worth as of the quarter ending Dec. 31, 2021, was $58.04 billion.
Tesla has five founders: Elon Musk, JB Straubel, Marc Tarpenning, Ian Wright and Martin Eberhard. Eberhard and Tarpenning were the original founders, but after Eberhard was ousted, the remaining three were named co-founders after a court battle.
According to Forbes, CEO Elon Musk’s current net worth is a whopping $255.1 billion as of Feb. 9, making him the world’s wealthiest person.
Key Product Lines Contributing To Revenue
Tesla’s prime product line is electric cars. In fact, Tesla’s Model 3 is now the best-selling electric car of all time — a record that’s probably safe for now considering that’s the model Hertz ordered.
In its slide deck for shareholders, Tesla said it aims to increase output quickly by ramping up production at new facilities in Texas and Germany and maximizing production from established facilities in California and China. Musk said during an earnings call that the factories have been running below capacity because of supply-chain issues, which he expects to continue this year. As a result, the company won’t release any new vehicles this year, CNBC reported. Instead, Musk plans to focus on engineering and tooling for future vehicles. Self-driving software will be a primary area of focus, according to the deck.
Automotive revenues reached $47.23 billion, including $1.47 billion in regulatory credits, in 2021 — a 73% increase over the previous year. Although Model S/X production dropped 19% compared to the fourth quarter of 2020, Model 3/Y production increased 79% for a total production increase of 70% for the year. Deliveries were up 71%.
Current Top Shareholders
The top 10 shareholders of Tesla stock are all asset managers/mutual fund companies. As a group, institutional and mutual fund shareholders own 42.32% of all Tesla shares. Here’s what the top shareholders list looks like:
Tesla’s Top 10 Shareholders
- The Vanguard Group, 6.17% of shares
- BlackRock Inc., 5.26% of shares
- Capital World Investors, 3.73% of shares
- Capital Research & Management, 3.77% of shares
- State Street Corporation, 3.11% of shares
- Geode Capital Management LLC, 1.31% of shares
- Baillie Gifford & Co., 1.08% of shares
- Jennison Associates LLC, 1.06% of shares
- Fidelity Management & Research, 0.99% of shares
- Northern Trust Investments Inc., 0.78% of shares
Any of these shareholder percentages can change at any time, even dropping down all the way to 0%. Tesla is currently a popular stock on Wall Street, so these percentages may hold, but if the company’s fortunes turn sour, institutions may bail out at any time.
How Does the Future Look for Tesla?
Tesla, like all auto manufacturers, is working to overcome ongoing supply chain issues and semiconductor shortages resulting from the pandemic. Despite those challenges, Q4 showed the company to be resilient and laying the groundwork for future products, including fully autonomous vehicles.
Tesla was great bet in 2021, but some think that the runup was too far and too fast. Of 23 analysts polled by Yahoo Finance, eight call the stock a “strong buy” or “buy” and 14 rate it “hold” or “underperform.” The analysts’ average price target is $963.92, which is about 4.5% higher than its most recent close price of $922 on Feb. 8.
Is Tesla Worth the Money?
Tesla is the ultimate love-it or hate-it stock. Short sellers keep betting the company will go out of business — which seems unlikely at this point — while dreamers and believers see the company as changing the fundamental auto and energy landscape. Therefore, the stock is likely to continue to undergo enormous price swings.
Whether or not you find Tesla to be worth the money will likely depend on which camp you fall into.
Regardless of your choice, share price is just one of the variables you should consider when investing in a specific stock. Your financial situation plays a large part in determining whether or not you should invest in stocks at all — let alone invest in a specific stock like Tesla. Working with a fiduciary financial advisor is a good way to delineate your investment objectives, risk tolerance and personal financial situation to determine if investing in stocks is a good match for you.
Data is accurate as of Feb. 9, 2021, and subject to change.
Methodology: The GOBankingRates Evaluation assesses a company’s net worth based on the company’s total assets, total liabilities, and revenue and net income from the last three years. Base value is established by subtracting total liabilities from total assets from the company’s last full fiscal year. Income value is established by taking the average of the revenue from the last three full fiscal years, plus 10 times the average of the net profits from the last three full fiscal years, and then calculating the average of those two figures. The final GOBankingRates Evaluation number is the sum of the base value and the income value.
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- The New York Times. 2021. "Tesla Has First Profitable Year, but Competition Is Growing."
- Forbes. "Real-Time Billionaires."
- The Washington Post. 2021. "Tesla passes $1 trillion in market value after Hertz orders 100,000 of its vehicles."
- Fortune. 2021. "Tesla joins elite club as its market cap passes $1 trillion for the first time."
- CNBC. 2021. "Tesla posts record revenue and profits in third quarter."
- CNN Business. "Tesla Inc."
- Tesla. 2021. "Q3 2021 Update."