Tesla’s stock has lagged the S&P 500.
Tesla (TSLA +3.10%) and its CEO and significant shareholder, Elon Musk, frequently make the news. It’s not always positive, with Musk’s potentially $1 trillion dollar pay package vote garnering sharp reactions.
But looking purely at the stock’s performance, how much would you have today had you invested $5,000 in Tesla shares a year ago?
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A volatile stock
Tesla’s stock has certainly been volatile. The shares have a 52-week low of $214.25 and a high of $488.54.
Through the ups and downs over the last year, Tesla’s share price rose 8.8% through Dec. 11. However, the S&P 500 index went up 13.4%. While Tesla doesn’t pay dividends, the S&P 500 had a total return of 14.8% after including the payouts.
Today’s Change
(3.10%) $14.74
Current Price
$490.05
Key Data Points
Market Cap
$1.6T
Day’s Range
$465.90 – $490.74
52wk Range
$214.25 – $490.74
Volume
3.5M
Avg Vol
86M
Gross Margin
17.01%
That means your $5,000 investment would be worth $5,444. That’s below the $5,737 if you’d invested passively in the S&P 500.
A look ahead
Tesla’s stock has certainly rewarded investors with market-beating returns over the long term. Over five years, the shares’ 126% appreciation beat the S&P 500’s 102.4% return.
With growing competition in the electric car industry and U.S. tax incentives disappearing, its core automotive business’ growth has slowed. Third-quarter automotive revenue increased 6% year over year to $21.2 billion.
Musk has promised a future of artificial intelligence, robotics, and self-driving cars. It’s unclear if and when these initiatives will pay off. Given the long wait and current climate for its core business, I’d pass on Tesla shares right now. For those investing, you should prepare yourself for the stock’s wild price swings.
