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Tesla (TSLA) stock prices are at an all-time high. Meanwhile, Elon Musk is on course to become one of the highest-paid CEOs in the auto industry.
These payouts are based on several Key Performance Indicators (KPIs) and targets. Keeping Tesla (TSLA) stock prices at predetermined levels is one of them.
Moreover, it has become known that Tesla managed to beat Toyota to become the world’s most valuable carmaker.
This places new pressures on Elon Musk who is known for his outlandish goals. The good thing though is that Elon is known to achieve those set targets.
Tesla Stock Price at All-Time High, Musk to Get a Mega Payout
Tesla (TSLA) stock prices have grown by 400% in the past year. it’s current stock prices are at 69 times the projections for 2022. Toyota on the other hand is trading ten times below its levels for the same period.
There is a growing consensus that Tesla stock prices are highly overvalued. This is because the automaker’s stock prices are hinging largely on the personality and achievements of its CEO.
All this is happening at a time when the fall out of the COVID-19 pandemic has caused the stock prices of many automakers to drop. TSLA stock prices seem to be an exception to the rule.
The current stock price levels are hanging on Elon Musk’s ability to produce and sell 400,000 cars annually.
Elon achieved this last year. Achieving similar levels of production, sales, and delivery is highly unlikely. The reason for this is simple. The economic fall out of the pandemic is yet to fully take effect. A core part of the recent recession is a massive drop in household revenues.
Man households won’t be able to purchase many things. Cars are one example.
This raises the bar for Elon and his team of achievers. Shareholders a year ago had approved a 10-year performance incentive that ultimately allows Elon to own as much as 12% of the total valuation of the company. This could reach up to $60 billion.
This is dependent on Tesla reaching certain market value levels. Besides, the automaker also has to hit certain revenue targets or adjusted EBITDA milestones.
Elon has already been given the first of the twelve portions of the incentive. This was due to a market valuation fo $100 billion and $20 billion. Musk is already eligible for the next one. Tesla (TSLA) has already exceeded a $150 billion market capitalization. He has to wait six months though to register it. The automaker is also on track to reach its revenue and EBITDA targets.
Naysayers think that he automaker won’t achieve its goals due to COVID-19. That may be a possibility. Then again we are talking about Elon Musk who has done some pretty impossible things. Impossible things are normal in Elon’s world.