For Tesla, 2020 was an amazing year. You may remember that it did a 5-for-1 stock split in late August, meaning that whatever number of shares you owned at the time was multiplied by five. The value of a share also was divided by five.
"Market cap" shows the astonishing rise of the company over twelve months. This metric is calculated by multiplying the number of shares by the current stock price. A year ago Tesla was valued at just over $100 billion, but this month the market cap is $780 billion.
It's a reflection of investors' confidence in the company's future success making and selling cars. At least some of that confidence now seems well-placed . . because Tesla in 2020, despite the pandemic, set impressive new records.
(cont'd tomorrow)
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