One of the more vexing developments for Tesla critics is the company's stock-price surge of nearly 350% over the past 12 months — and more than 30% since the beginning of the year, as the coronavirus pandemic has ravaged auto sales worldwide.
General Motors, for example, has seen its shares decline 30% since the beginning of 2020. But the carmaker has actually turned in better-than-expected sales, thanks to the durable popularity of big (and profitable) pickup trucks.
For roughly the past five years, as Tesla's stock has fluctuated wildly, plunging to $150 but rocketing to more than $1,000, the debate about what's going on has typically been framed as Tesla-the-tech-company vs. Tesla-the-car company.
Numerous bulls argue that Tesla is, in fact, an innovative tech firm — a new Apple — that merits a Silicon Valley valuation. Bears counter that Tesla is, at base, a car company and should, someday, be valued accordingly.
I used to be in the latter camp, but the past year and a half has changed my mind. I don't, however, think that Tesla is a tech company. Instead, Tesla is a throwback — but a throwback squarely aimed at the future. For various reasons, we can't figure Tesla out because what it's doing is reminiscent of the nascent businesses of the early 20th century.
Tesla isn't mining tech or automotive — it's creating a new industry. The markets have figured this out and are pricing the company's stock accordingly.
Here's how Tesla is doing what hasn't been done for over 100 years: