Tesla TSLA S&P 500 Debut Could Spark $8B in Stock Demand, Goldman Sachs Says

by Eva Fox November 20, 2020

Tesla TSLA S&P 500 Debut Could Spark $8B in Stock Demand, Goldman Sachs Says

Tesla's (NASDAQ: TSLA) impressive growth may soon continue with renewed vigor. TSLA shares again hit an intraday all-time high yesterday, reaching $507.76 a share, but things could get even more interesting soon. The company's scheduled inclusion in the S&P 500 on December 21 could lead to $8 billion in demand from active US large-cap mutual funds, analysts at Goldman Sachs Group Inc. wrote.

“Of the 189 large-cap core funds in our universe, 157 funds that manage around $500 billion in assets under management did not hold Tesla on September 30,” the analysts wrote. Assuming those funds chose to hold Tesla at benchmark weight, they would need to buy $8 billion of the stock or about 2% of Tesla’s market value, said Goldman Sachs, according to MoneyWeb.

Tesla is one of the most profitable stocks--if not the most profitable--this year. The company has demonstrated continuous development and profitability for five quarters in a row. Tesla is the only company in the auto market to successfully operate during the COVID-19 crisis, proving wrong even the longest-standing critics and skeptics. Tesla is developing in the main automotive markets of the world, capturing an increasing part of them. In addition, the company is successfully developing in many other areas beyond automotive, which ultimately will make up a large part of Tesla's income.

© 2020, Eva Fox. All rights reserved.

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This article is for informational purposes only. You should not construe any such information or other material as an investment, financial, or other advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, or offer by Eva Fox, Tesmanian, or any third party service provider to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction.

Eva Fox holds zero shares of Tesla, Inc., and currently (at the time of this article's publishing) holds zero options or securities in Tesla Inc. and/or its affiliates.




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