At US$168 ($229) at the end of April, Tesla has gained another similarly auspicious 888% in five years. However, that belies plenty of volatility of as high as US$400 in October 2021 to as low as US$100 last January. It enjoyed a surge to US$280 last July but ended up as the first among the so-called Magnificent 7 stocks to rediscover gravity exists as revenue and earnings growth slowed. Even so, Tesla still trades at a rich 43 times P/E.
The phrase “run on the market” occurs when consumers or investors buy more because of fears of a shortage, which leads to a further shortage, adding to the self-sustaining momentum. This phenomenon had been nicely encapsulated when crypto bros tweet “TTM” (to the moon) rocket emojis or when meme stock bros “yell” on Reddit to urge one another on.
In the same vein, Tesla, under Elon Musk, could do no wrong. For the longest time, fans fanned their own Fomo and pushed up both the stock and its options as they all pondered the future universe full of Tesla electric vehicles (EVs) together.
