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Elon Musk, the founder and CEO of Tesla Motors and SpaceX, is reportedly worth $85.8 billion, thus making him the fourth wealthiest individual according to the Forbes list of the world’s billionaires. In the early days of summer in 2020, Musk was listed as the fifth on the Forbes list, but he is now just below Amazon CEO Jeff Bezos, who in turn is catching up to the respective net worth of Bill Gates and Mark Zuckerberg.
The factor that put Musk ahead on the list is directly related to Wall Street. In the midst of the coronavirus pandemic of 2020, Wall Street investors are trading like there is no tomorrow, and they seem to really like Tesla stock. In just two trading sessions in the middle of August, investors bought and sold more than $13 billion worth of Tesla shares; this resulted in Musk moving ahead of Bernard Arnault, who has been chairman of the Louis Vitton board since the 1990s.
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Space is the Place for Musk
It is interesting to note that both Bezos and Musk are locked into a space race. Bezos’ aerospace company Blue Origin has been making headlines with development of rocket engines that will be used by the United States Space Force, the branch of the military founded during the administration of President Donald Trump. SpaceX, the aerospace firm founded by Musk, recently accomplished a streak of six consecutive Falcon 9 rocket launches and recoveries. NASA has already worked with Musk in a successful launch, transport, and return of astronauts to the International Space Station, and the agency is over the moon, so to speak, with what SpaceX has to offer.
Even though SpaceX is not a public company trading on Wall Street, investors who follow developments related to this maverick aerospace giant cling to Tesla stock because they can easily associate the automaker with Musk and SpaceX. It should be mentioned that market analysts from Morgan Stanley have characterized Tesla as being wildly overvalued, but Wall Street investors are not listening.
Understanding the Cult of TSLA
Tesla Motors is the most successful electric automaker in the world. Even though big names such as Ford Motors and Toyota could easily give Musk’s company a run for his money, they have not been able to do so. This really puts a premium on Tesla stock, which trades on the Nasdaq as TSLA.
Even when the aforementioned Morgan Stanley analysts issued a cautious opinion about TSLA in July, thousands of new investors on the mobile trading app Robinhood rushed to acquire TSLA shares. Day traders love TSLA; this is a stock that promises heavy trading volumes whenever Wall Street is in session, and it is not as volatile as some people would think.
As the CEO of Tesla, Musk is guaranteed a series of bonuses whenever the company hits certain targets. The board agreed that $55 billion was a fair reward in 2018, and Musk has pretty much delivered on all the targets set. The capitalization of the company has skyrocketed to exceed the likes of General Motors, and this has a lot to do with the performance on TSLA on Wall Street.
The passion for TSLA is really not that hard to understand. At 49 years old, Musk is a member of Generation X, but he caters to even younger investors. The South African born tech entrepreneur is known for his irreverent comments on social media, particularly on Twitter, but he is also widely respected for his vision of technology innovation. Musk is clearly the closest we have to Thomas Alva Edison in the 21st century, and his numerous fans believe that increasing the valuation of TSLA is their duty, and they seem to be doing pretty good in this regard
