Trump's election, Musk is the big winner! TSL stock price may soar to 50 dollars, how will the collaboration between politics and business rewrite the future of the United States?

The dust has settled on the US election, and former President Trump has secured victory ahead of time. However, the biggest winner of this White House battle may not be Trump, but his big donors and "pioneer" Musk behind him.

On November 6th local time, Dan Ives, a loyal fan of Musk and an analyst at the US investment bank Wedbush, posted a post expressing his frankness about his optimism for Musk and TSL.

The biggest beneficiary of Trump's victory will be TSL / Musk.

We believe that Trump's victory is negative for the electric vehicle industry because electric car discounts/tax incentives will be canceled, but it is positive for TSL because TSL has a huge advantage in scale/price.

Trump's victory could potentially cause Tesla's stock price to rise 40-50 dollars.

Image source: Wall Street News

TSL's market value has grown by $300 billion since its low point in April. In addition, since Musk publicly expressed support for Trump on his social platform X, Google users' search interest in him has doubled. Analysts expect that this election will bring more car sales for TSL, more ad orders for X, and more support for SpaceX, Musk's American space exploration technology company, under his flag.

The benefits are more than that. After Trump's victory, Musk's political resources cannot be underestimated. On the other hand, if Hillary wins, as Musk has previously joked, he could end up in jail.

Since July of this year, Musk has officially joined the Trump camp, and then almost bet his entire wealth on Trump's victory. Three months later, this high-stakes gamble finally paid off with a huge return.

At this time, to ask how Musk himself feels, just look at the post he made today to know.

The future will be very bright! (Musk also thoughtfully brushed Trump with a 'big rocket')

Source of the image: X

TSL continues to open up the imagination space.

Trump may accelerate the announcement of measures supporting autonomous driving technology after taking office, which is a big Favourable Information for TSL, which focuses on fully autonomous driving technology (FSD).

In addition, Trump advocates a substantial increase in tariffs, which may further restrict the influx of affordable electric vehicles from abroad into the United States and help TSL maintain its leading position in the US market (with a market share of over 50%).

It is worth mentioning that even if Carrie Lam wins the election, TSL can also benefit from it, because the Democratic Party advocates clean transportation.

Therefore, no matter who wins, TSL is the winner.

Before election day, Ives rated TSL as "outperforming the market" with a target price of $300, about 20% higher than TSL's closing price on Tuesday.

Source of the image: X

According to the rating website Tipranks, Ives' views are supported by 10 other analysts, while 16 analysts believe it should be held, and 8 analysts believe it should be sold, so TSL has received a universal "hold" rating.

One step closer to the 'Mars Dream'

From the perspective of the space market, Trump's victory is also beneficial for Musk in many ways.

Musk has said that under Democratic governance, the possibility of SpaceX realizing the 'Mars dream' is unlikely, while under Republican governance, SpaceX may receive greater support from the government.

But regardless of the election outcome, NASA and SpaceX are closely linked.

According to federal records, NASA has incurred nearly $10 billion in debt to SpaceX since 2019. However, if Heather Hidalgo takes office, she may not agree to bear the huge debt for SpaceX.

Political capital expanding, Musk hints at entering politics?

If Trump allows Musk to enter the government and take up an important position, Musk may transform from a commercial giant to a political pro.

Trump previously mentioned that if he were to return to the White House, he would ask Musk to lead a Department of Government Efficiency. Musk later responded that if Trump were elected, he could find a $2 trillion reduction target in the government budget, which would fundamentally reshape government spending.

After the election today, Musk posted a meme on the X platform of himself 'holding a sink in the presidential office' and captioned it 'Let it sink in', implying his intention to enter politics. In 2022, when Musk took over Twitter, he promised to lay off employees and even entered the Twitter building holding a sink.

Image source: Wall Street News

However, entering the government sector also means that Musk may have to keep his distance from TSL and SpaceX. Without Mr. Ma's leadership, the value of TSL is bound to be greatly discounted. Compared to the car business, the rise in TSL's stock price depends more on Musk's 'BTC'. In addition, unlike the whimsical senior executives, politicians also have to deal with the trivial matters of dealing with Congress. Even with Musk's abundant energy, he may be stretched too thin.

Taking history as a mirror, Musk's political career did not go smoothly. The CEO Advisory Council during the Trump administration only lasted for six months. The council was established in late 2016 and was led by Larry Fink, Chairman and CEO of BlackRock. Musk was also a member of the council.

Even if Musk gives up important government positions, his political resources will soar as the "number one hero" of Trump's victory.

[Disclaimer] The market is risky, and investment should be cautious. This article does not constitute investment advice. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their specific situation. Investing based on this information is at your own risk.

This article is authorized for reprint from: "Shenzhen TechFlow"

Original author: Bo Shuqing, Wall Street Insights