Musk Net Worth Rose $6 Billion In One Day, Overtakes Warren Buffett

Tesla CEO Elon Musk became the seventh-wealthiest person in the world on Monday, surpassing billionaire hedge fund investor Warren Buffet.

Musk’s net worth rose over $6 billion in one day on the tide of Tesla’s stock price, which jumped in morning trading and hit a new high later in the day when up 14% from its Friday closing. The electric car company later lost all its gains and then some, ending the day down 3%, according to Investor’s Business Daily.

Still, Tesla’s surging stock price, which has skyrocketed about 70% in a month, has put Musk’s net worth seventh on the Bloomberg Billionaire Index, placing him between Google’s cofounders Larry Page in sixth and Sergey Brin in eighth. Since the start of 2020, Musk’s net worth has risen more than anyone else’s in the world except for Amazon founder and CEO Jeff Bezos’s.

MarketWatch reported:

Tesla Inc. TSLA, -3.08% shares on Monday rose more than 14%, headed for a record high and trading above shares of Google’s parent Alphabet Inc. GOOG, -1.97% GOOGL, -1.74% and Priceline.com’s Booking Holdings Inc. BKNG, -1.20%. The stock’s one-day gain is its best since a 16% jump in March. The rally has pushed the Silicon Valley car maker’s market value to around $321 billion, the most valued car company in the world after Japan’s Toyota Motor Co. TM, +0.06%. Tesla shares are up nine out of the past 10 sessions as investors await the company’s second-quarter results next Wednesday, and the possibility of a surprise quarterly profit that would set the company to joining the S&P 500 index. SPX, -0.93%

Tesla’s stock price is up about 300% on the year. The electric car manufacturer’s rise has fueled investor confidence that the company may post its fourth straight quarter of profits, the first such streak in the company’s history and a necessary milestone that makes it eligible to be considered for the S&P 500, according to CNBC.

If Musk’s company continues climbing at the rate it has in recent weeks, the stock price will meet the final threshold in the CEO’s performance ladder of incentives. Musk would earn 1.69 million stock options, which if he chose to sell immediately, would give him a 10-figure payout, according to Bloomberg.

The company’s stock price may be severely overinflated, some Wall Street analysists warn. Tesle’s surging stock price has confounded experts who are trying to make sense of the sudden and meteoric rise of the electric car company.

The Bear Traps Report editor Larry McDonald said that Tesla’s stock price is destined to drop.

“By buying up Tesla [stock] now, front-runners are forcing the S&P Indexes to give the stock a higher and higher weighting,” McDonald wrote in a recent note, according to Observer. “Thus, ETFs / Indexes will be forced to pay up, buying even more shares. Then the hot money exits, leaving indexes holding the bag.

Morgan Stanley transportation analyst Adam Jonas also urged caution on Tesla’s stock price, saying on Friday, “the days of Tesla’s virtually unchallenged dominance may be numbered.”

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