In an example of just how completely the stock of Tesla Motors appears to be affected by Elon Musk’s every word or action (including tweet), the stock of the electric vehicle (EV) manufacturer climbed well over 3% on Monday (from ~$182.50 to $192.50) following a tweet from the controversial CEO concerning a “major” announcement to be made at the end of April.
The major announcement appears, this time — despite earlier underwhelming “major” announcements — to truly be something worth taking note of, the unveiling of an entirely new product line.
Major new Tesla product line — not a car — will be unveiled at our Hawthorne Design Studio on Thurs 8pm, April 30
— Elon Musk (@elonmusk) March 30, 2015
While the exacts of the announcement have, of course, not yet been revealed, there are a number of believable guesses out there now — in particular, the official unveiling of a home energy storage system seems the greatest (almost a completely obvious) possibility. On a conference call in February, Musk said that a home energy storage product would be unveiled in 1–2 months. Going by calendar months rather than # of days, April 30 would just barely stay in that timeframe. So, it seems like a given that this is what the product will be. Still, it’s not the subject but the details that will really matter.
Regardless of what the announcement at the end of April will actually be, the recent happenings certainly do drive home just how volatile the Tesla (TSLA) stock is — it really doesn’t seem to take much, just a short comment from Musk, to get the ticker moving in a predictable direction (if only for a short time, before rebounding one way or the other). Now, if only there was a way to profit from such a predictable, reliable reality….
I think you can spot in the following screenshot of Tesla’s stock price (from two days ago) when Elon tweeted his teaser:
It seems many investors picked up on the likelihood of the product being a home energy storage unit, and made the connection to Elon’s sister company, SolarCity, as this was the stock price trend for SolarCity (SCTY) at the same time:
Regardless of short-trading potential, the mid- to long-term potential of the stock has attracted a fair number of different perspectives — with some claiming the stock is overvalued, and some (or is that many?) claiming that it is greatly undervalued. These are both speculative guesses, though, and we won’t really know much about the company’s long-term prospects until the Gigafactory is up and running at full capacity and the Model 3 has been released.
Image Credit: Tesla Motors
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