Earlier today, we reported on Tesla Motors”s first day of trading on the NASDAQ and the fact that the company raised more than had initially been expected. We had mentioned shares of the California start up selling for $17 each, which was more than the $14-$16 initially anticipated. It got much better however, as the day progressed. Shares went as high as $21.50 today.
Tesla”s impressive performance came on a day when U.S. stocks fell more than 2%, and amidst a market that has forced many companies seeking to raise capital through IPOs to accept less money to effectuate deals.
This IPO represents the first for an automaker since Ford Motor Company held its IPO in 1956. CEO Elon Musk, who recently made headlines for his financial troubles was on hand to mark the start of the trading day, along with at least five Tesla vehicles, including the $109,000 Roadster.
This IPO represents a huge bet on the future of the electric car industry, which while Tesla currently has its hooks in deep, it is not alone. With the high-profile Elon Musk (who co-founded PayPal) as its CEO and Toyota as a prominent backer, investors should not be put off by the fact that company has not had a profitable quarter since 2003. This a very dynamic time for a sub-sector that is poised to explode in an industry that is rallying a strong comeback from a bleak market.
– By: Stephen Calogera