What Happened?
Shares of electric vehicle pioneer Tesla (NASDAQ: TSLA) jumped 4.1% in the afternoon session after reports indicated the U.S. administration planned to prioritize robotics development, a move that could benefit the company's Optimus humanoid robot project.
According to reports, the Commerce Secretary met with robotics CEOs and expressed strong support for advancing the sector, with the administration considering an executive order to accelerate innovation. This news was bolstered by other positive developments for the electric vehicle maker. The company's Shanghai factory reported a significant rebound in shipments, delivering 86,700 vehicles in the previous month, a 41% jump from October.
Additionally, Tesla qualified for the largest allocation of advanced energy project tax credits, receiving a certification worth $240.3 million from the IRS. The company also continued its push for its Full Self-Driving technology in Europe, hosting the mayor of Rome for a road demonstration.
After the initial pop the shares cooled down to $446.33, up 4% from previous close.
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What Is The Market Telling Us
Tesla’s shares are extremely volatile and have had 45 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock gained 6.9% on the news that CEO Elon Musk posted on his social media platform, X, that the electric vehicle maker expected to build its own AI chips in higher volumes than all other AI chip makers combined.
Musk’s post gave investors fresh insight into Tesla's fast-moving internal AI chip development and highlighted the company's aggressive ambitions in the semiconductor industry. This news supported the long-term view held by some investors that Tesla's future is based on artificial intelligence and robotics, beyond its core electric vehicle business. Musk also shared that the company was iterating quickly on its chip designs, with the AI4 chip already in its cars, the AI5 version nearly ready, and an AI6 chip in early development. Separately, Melius Research reaffirmed its Buy rating of the stock, noting that "TSLA remains a step ahead of peers." The firm added "after a very long and gradual period of improvement, autonomy is coming very soon, and it will change everything about the driving ecosystem.".
Tesla is up 17.7% since the beginning of the year, and at $446.33 per share, it is trading close to its 52-week high of $479.86 from December 2024. Investors who bought $1,000 worth of Tesla’s shares 5 years ago would now be looking at an investment worth $2,257.
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