Investing.com – Tesla shares rose sharply yesterday, gaining as much as 7.8% at one point during the day, when the stock marked a high of $191, eventually closing at $182.55, up 3 %, after having gained almost 4% the day before.
Note that this rally is explained by the anticipation, then by the celebration of the approval of Elon Musk’s compensation package by the company’s shareholders. Indeed, some big investors were against this $56 billion plan, and its rejection could have meant Musk’s departure from Tesla Inc (NASDAQ:), or the transfer of certain company projects to other companies than he manages.
However, a large part of the success of Tesla stock is based on the confidence investors have in Elon Musk, and in his ability to make them dream by describing a future for Tesla that goes well beyond electric cars in the long term. .
Indeed, Tesla plans in particular to capitalize on its fleet of electric vehicles to develop a robotaxi activity. This is also the main justification for the conviction of the famous Cathie Wood of Ark Invest about the action.
Remember that it recently reiterated its target of $2,600 by 2029 for Tesla, which would represent an increase of 1,324% compared to the current price.
However, Elon Musk himself is even more optimistic than Cathie Wood for his company, having estimated during the annual meeting of shareholders which took place yesterday that the capitalization of Tesla could one day reach 25,000 billion dollars, in particular thanks to the robot humanoid Optimus.
Knowing that Tesla’s capitalization is currently $578.65 billion, this represents an upside potential of more than 4220%!
However, these are long-term forecasts. And the road that remains to be covered to set up and make a robotaxi activity profitable is still long, and it is even longer as far as Optimus is concerned. In the meantime, Tesla will continue to evolve according to financial results and Musk’s promises.
In other words, while Tesla deserves a spot on the radar of tech stock-focused investors looking for big returns, it may not be the stock that performs best in the coming months. .
Which tech stocks will soar?
Additionally, after the AI rally highlighted and pushed many tech mega-caps to record highs, the next phases of the tech bull market will likely benefit lesser-known companies more.
Obviously, it would be a bit “daring” to completely exclude large technology stocks from your portfolio. However, if you want to seize the best opportunities for the next phases of the rally, it will be necessary to broaden your investment horizon to lesser-known companies and more specialized activities than the current stars of the US stock market.
However, this is precisely what the Tech Titans strategy does, one of InvestingPro’s ProPicks portfolios, managed by artificial intelligence trained on InvestingPro’s vast financial data.
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- Perficient: +56.39% in May
- Vistra Energy Corp: +37.08% in May
- Marathon Digital (NASDAQ:) Holdings: +24.70% in May
- Applovin Corp: +18.30% in May
- NVIDIA Corporation (NASDAQ:): +33.07% in May
- NAPCO Security Technologies: +28.88% in May
- Louisiana-Pacific Corporation: +24.88% in May
- Wayfair Inc: +17% in May
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