Why Tesla Stock Was Crushing the Market This Week

What happened

Hardly for the first time in its life, Tesla ( TSLA -0.49% ) was leaving many other stocks in the dust this week.

On the back of several pieces of encouraging news, the enduringly popular electric vehicle (EV) company’s shares had risen by 12% week-to-date as of market close Thursday, according to data provided by S&P Global Market Intelligence. That was far better than the barely over 1% gain of the S&P 500 index across that stretch of time.

So what

It sure was an eventful few days for Tesla. Arguably the most important of said events was Tuesday’s long-awaited opening of its Gigafactory near Berlin, Germany. Now that the sprawling plant more or less in the middle of Europe is open, the company is that much better positioned to serve the big market on that continent. 

Image source: Tesla.

Ultimately, Tesla has massive ambitions for the factory, which it hopes will produce 500,000 vehicles annually. Already cars are rolling out of the facility — Tuesday was also declared “Delivery Day,” with 30 Model Y SUVs going out to customers from there.

Investors are surely relieved that the facility is now onstream; its opening was delayed for months due to licensing difficulties.

Later in the week, auto rental mainstay Hertz Global Holdings added the Model Y to its fleet. Last October the company placed an order for 100,000 Tesla vehicles, but this order was for the comparatively inexpensive Model 3 sedans. Its purchasing of Model Ys means the Hertz/Tesla partnership will produce more revenue for the latter company.

Now what

Ultimately, there was lots of silver lining and few gray clouds for Tesla this week. The rock star EV company seems to be going from strength to strength; investors will be hoping it can keep up that momentum.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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