Shares of Tesla have fallen more than 34% in the last week, marking a major reversal in the fortunes of what has been one of the most popular stocks this year.
Telsa shares fell to $ 330.21 at the close of the market on Tuesday, down from a high of $ 502.49 at noon a week ago. On Tuesday alone, the electric carmaker’s shares fell more than 21%, its worst daily decline.
The drop is largely attributed to Tesla not being included in the S&P 500 index on Friday, which surprised investors who thought the company was included on the list. Tesla also announced that it had sold $ 5 billion in new shares, diluting the value of existing investors’ shares.
Meanwhile, shares soared Tuesday for Tesla competitor Nikola, an electric vehicle and fuel cell startup, after partnering with General Motors on an electric truck that is expected to start production in 2022. The truck will compete with the Tesla Cybertruck, which Tesla expects to begin production. . by the end of next year.
The drop in Tesla shares also coincides with a major reversal in the Dow Jones and Nasdaq indices, which had suffered a breakout this year despite the economic calamity caused by the coronavirus pandemic. Tech stocks have suffered the most, with big tech companies like Apple, Facebook and Amazon falling in recent days.
With stock prices falling, Tesla’s market value has fallen to $ 307.7 billion, down from $ 468.2 billion last week. During its career, Tesla’s market capitalization had surpassed that of Walmart, giving Tesla huge bragging rights in the process. But now the value of Tesla has fallen well below the giant retailer, which was worth $ 392 billion as of Tuesday.
Despite last week’s slide, Tesla shares are still up nearly 284% since the beginning of the year.
Colin Rusch, an analyst at investment bank Oppenheimer, said he expects more stock market volatility for the rest of the year. But when it comes to Tesla, he sounded a somewhat positive note, saying the company’s technology and cars have a “fundamental advantage” over rivals.
