Elon Musk is engrossed in Twitter, Tesla’s capitalization plummets by nearly $ 700 billion, equivalent to 6 times the value of Starbucks, 12 times the value of Ford

Tesla’s market capitalization has fallen by nearly $700 billion from its all-time high of $1.2 trillion.

Specifically, Tesla’s stock rose from $30 per unit in early 2020 to more than $400 per unit last November, bringing Tesla’s market cap from less than $100 billion to more than $1. 2 trillion USD. However, it has dropped nearly 60% since then, to $530 billion by the end of November 21.

Tesla’s $670 billion in reduced market value alone is close to the current market capitalization of Warren Buffett’s Berkshire Hathaway ($685 billion). That, of course, far exceeds the market capitalization of Johnson & Johnson ($460 billion), Exxon Mobil ($457 billion) and JPMorgan ($390 billion).

For further comparison, the $670 billion figure is more than double the capitalization of Home Depot ($324 billion) or larger than the combined market value of both Coca-Cola ($268 billion) and PepsiCo ($255 billion). total.

More notably, Tesla’s market capitalization decline is nearly triple the market value of McDonald’s ($201 billion), Disney ($178 billion) or Wells Fargos ($178 billion). That number is also equivalent to about 4 times the capitalization of Nike ($162 billion), 5 times the capitalization of Netflix ($127 billion), 6 times the capitalization of Starbucks ($113 billion), 7 times the capitalization of PayPal. ($92 billion) and 12 times the capitalization of GM or Ford ($56 billion each).

In the current S&P 500 index, only Apple, Alphabet, Amazon, Microsoft and Berkshire Hathaway have a market value of more than $670 billion — a number that has been blown away from Tesla’s capitalization over the past year.

According to Business Insider, this significant drop reflects concern that Elon Musk’s recent takeover of Twitter will be a costly affair.

In addition, investors also sold off stocks at high levels like Tesla in the face of high inflation, rising interest rates and looming economic recession.

Elon Musk’s carmaker promises big profits in the future, but those dollars are becoming less attractive as prices skyrocket, savings accounts and bonds offer bigger returns. and risk-free, and economic downturn has the potential to affect the earnings and capitalization of the group.

Moreover, the 51-year-old billionaire recently bought Twitter for $44 billion and is busy making changes there, including laying off thousands of employees and revamping the business model.

Another important thing, Elon Musk sold at least 19.5 million Tesla shares ($3.95 billion) just days after completing the Twitter acquisition. In a conversation with the company’s employees on November 10, the billionaire said he sold shares of the electric car company to “save Twitter”.

This further fueled concerns among Tesla shareholders that Elon Musk might lose focus or sell more stock. Either of these could drag down the automaker’s stock price.

So far, Tesla’s staggering market capitalization has divided experts. Some expect Tesla stock to rebound and hit new highs in the next few years while others predict it could fall further.

Source: BIEN