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Just looking at the current revenue, the valuation of Tesla seems increadible high. But there are quite a few reasons for the optimism connected to Tesla.

Tesla by a fair margin owns the market for electric cars. So anyone who thinks that electric cars are the future, should expect Tesla to do quite well. All big car companies are trying to keep up with Tesla in electric car tech and additionally, if the transition comes, are burdened with a lot of production facilities for ICE cars.

Tesla is also much more than just cars, they have their own charging infrastructure, battery manufacturing, might play a big role in cell manufacturing going forward and are getting important in the energy sector, which might overtake the car business one day.

Also, Tesla is growing exponentially. This gives a lot of growth fantasy, that they might get to the size of Amazon one day, which would mean a multiple of stock value compared today.

But most importantly, and that is the reason they have such a strong support amongst their current and potential customers: they keep innovating. A bit like Apple of the old, if they announce a new product, prepare to see something really new. While traditional car manufacturers keep iterating on their products, Tesla has completely new things, just think of the Cybertruck. Which other car annoucement got that much press coverage as the Cybertruck? Also, the Semi could get huge.

There are also some very technical factors driving the recent raise of the stock: there have been quite a few good, if not great news (Q4 sales numbers, Gigafactory 3 operating within 1 year of the building start, Gigafactory 4 planned). Then there is still a huge amount of stock shorted, so while it not might be a full short squeeze, the shorts need to cover the stocks they shorted. Finally, Tesla might join the S&P 500, which means, that a lot of institutions have to buy Tesla stock, which will drive it up further, at least short-time.




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