No previous year has started as well for Tesla’s stock as 2023


Tesla Inc. has added more than $200 billion to its market capitalization in the first three months of the year alongside what’s likely to be the best start to a year for the stock in its history.

Shares of the electric-vehicle company have roared 54% higher so far in 2023, putting them on track to log their largest quarterly percentage gain since the fourth quarter of 2020, according to Dow Jones Market Data. That would mark Tesla’s TSLA, +3.04% seventh-best quarter on record if the gains carry through to the end of the period, as well as Tesla’s best first quarter on record.

Tesla’s market value has swelled to $593 billion from $389 billion at the end of 2022, which was a disappointing year for Tesla shares. The stock shed nearly two-thirds of its value for its worst annual percentage decline on record, and only its second full-year drop since the company went public in 2010.

For more: Tesla is not alone — 20 (and a half) other big stocks had their worst year on record in 2022

Much of Tesla’s momentum this quarter came early in the period, as investors poured back in to growth-oriented technology stocks amid greater optimism about the economy and the market. Tesla likely also benefited from some company-specific drivers, including price cuts that helped quell concerns about competition, an optimistic tone from management around demand trends and a cooling of attention paid to Chief Executive Elon Musk’s purchase of Twitter Inc.

Tesla shares enjoyed their best week in a decade at one point in January, as Musk told investors on the company’s fourth-quarter earnings call that demand for Tesla vehicles was still way ahead of production.

A Morgan Stanley analyst mused at the time that Tesla’s January price cuts, which allowed more Tesla vehicles to qualify for tax credits, could usher in a “great deflation” that would be beneficial for the EV industry and a signal of how far production technology has come.

See also: 11 stocks in the S&P 500 expected to form an exclusive growth club for investors

Looking ahead, RBC Capital Markets analyst Tom Narayan expects Tesla to post strong delivery numbers for the first quarter.

“We increased our forecast based on strong sales data during the first two months of the quarter and believe sales accelerated in March,” he wrote, as he upped his delivery forecast to 445,000 units from 418,000. “Production and sales data in China seem solid, and weekly domestic sales data in the first few weeks of March is robust which we assume continues.”

The FactSet consensus is for 432,000 deliveries, though that target has been declining — analysts on average expected 499,000 deliveries at the end of the third quarter last year, and 437,000 at the end of February.

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