It’s definitely confusing.
How can Tesla, that makes less than 100k cars a year, and loses money … be worth $26 billion dollars?
The answer is, has to be, that “Wall Street” and public investors see incredible growth coming.
It happened with Apple. Which went from a broken stock, to #1 in market cap, once it become clear they’d changed a huge, semi-new market with the iPhone (2007) and were on a path to dominating it (2009+). Then Apple went on its epic run:
Clearly, folks now believe Tesla is on an Apple-like path. Not there yet, but on one.
Look at Tesla’s stock price. It’s not like the public markets believed it even after the IPO. The stock was pretty flat, like Apple, for quite a while before the Model S launched and had some success.
It took time:
In fact, as we now know, Tesla almost failed even after its IPO — and came close to selling to Google in early ’13: Elon Musk Had a Deal to Sell Tesla to Google in 2013
Just before its epic run-up in stock.
But as the Model S shipped in volume, as the company proved it could scale … the public markets began to believe it might be something like the next Apple. That it could just explode, and dominant at least a segment of a very large, changing market over the coming years.
If it does … then Tesla could grow another 10x in stock price or more.