Many short-sellers gave up shorting Tesla stock. In March of this year, Tesla’s stock price hit its lowest point in 2021, but after that, its stock price has risen by 39%, causing a large number of short sellers to have to react to it. According to IHS Markit data, as of last Thursday, the proportion of stocks borrowed by traders (a measure of short interest) has fallen to 1.1% of Tesla’s tradable stocks, which is the lowest since the company went public in 2010 value.
Although data from S3 Partners shows that Tesla’s short interest is higher, accounting for about 3.2% of the outstanding shares, this level has also fallen to the lowest level ever. S3 analyst Ihor Dusaniwsky said that Tesla has recently seen some short covering. In the past month, short-selling stocks have decreased by 1.55 million shares, valued at approximately US$1.2 billion.
Moreover, the pain experienced by short-sellers may be about to become more severe. Tesla reported last weekend that its car deliveries set a new record last quarter. Wedbush analyst Daniel Ives described Tesla’s delivery figures as a major victory for supporters of the stock.
The pessimism on Tesla stock reached its peak in 2019, when Musk warned that the company would need to lay off employees and increase production to continue to survive. Since then, as the automotive industry’s transition to electric vehicles has accelerated, Tesla has consolidated its first-mover advantage, and its stock price has soared by more than 1,000%.
On Monday, Tesla’s stock price rose by 4.1% to 806.97 US dollars. After that, most of the gains fell, and it closed up 0.8% to 781.53 US dollars. The stock set a record close of $883.09 in January. Ives said: Although there are many competitors in the field of electric vehicles, Tesla continues to dominate the market share, this quarter’s figures once again prove this, even though they are fighting a shortage of chips.