Tesla Regains $1 Trillion Market Cap As Shares Extend Rally After Trump's Victory

Tesla Inc. regained a $1 trillion market cap on Friday as its shares continued to rally, driven by investor optimism around President-elect Donald Trump’s recent election win and the potential positive impact of his return to the White House on the company.

Shares of the electric vehicle maker rallied 26.1% this week. Previously, the company's market cap had crossed the $1 trillion mark in October 2021, December 2021, and March 2022.

Musk has been a strong supporter of Trump and part of the inner circle of the Republican candidate's electoral campaign. Then the former has even offered the Tesla CEO a position in his cabinet, should he come back to power.

During the presidential election campaign, Tesla CEO Elon Musk emerged as a significant supporter of Trump, contributing at least $130 million to a pro-Trump initiative.

Following Tesla's third-quarter results, research firm Barclays said in a note that Model 3 and Model Y vehicles used for ride-hailing comply with Federal Motor Vehicle Safety Standards and should not encounter federal barriers to deployment.

During the earnings call, however, Elon Musk mentioned his intention to use his influence with a potential Trump-Vance administration to create a federal approval process for autonomous vehicles. Currently, approvals are managed at the state level, which Musk views as a regulatory challenge Tesla must navigate as it moves towards offering fully autonomous driving systems.

Among the 61 analysts tracked by Bloomberg, 27 of them had a "buy" rating on the stock, while 19 brokerages had a "hold" and 15 of them had a "sell" call.

The analysts consensus 12-month price target tracked by Bloomberg is $236.77, implying a potential downside of 24.7% from Thursday's close. The stock has rallied more than 26% so far this year.