TLDR
- Tesla shareholders vote Nov. 6 on Elon Musk’s $1 trillion pay package tied to $8.5 trillion market cap target
- ISS opposes the compensation plan due to dilution concerns, but analysts expect approval based on past voting patterns
- Stock climbed 2.6% to $439.79 with technical indicators showing bullish momentum above $400 support
- Q3 earnings report drops Oct. 22 with Wall Street forecasting 55 cents per share
- BNP Paribas initiated coverage with $307 price target, calling Tesla overvalued on AI ventures
Tesla stock pushed higher on Oct. 20, gaining 2.6% to close at $439.79. The move comes as shareholders prepare for a controversial vote on CEO compensation.
Elon Musk’s proposed 2025 pay package could reach $1 trillion if performance targets are met. The deal includes roughly 425 million stock options.
Those options vest if Tesla hits an $8.5 trillion market cap. That would price shares around $2,700 each.
Performance milestones include delivering 20 million EVs cumulatively. The plan also requires 10 million Full Self-Driving subscriptions and one million Optimus robots delivered.
Institutional Shareholder Services recommended voting against the package. The proxy advisory firm cited shareholder dilution and board independence issues.
ISS previously opposed Musk’s 2018 and 2012 compensation deals. Shareholders approved both packages anyway.
Wedbush analyst Dan Ives expects the same outcome this time. Future Fund’s Gary Black agrees, saying there’s no chance of rejection.
The shareholder vote happens Nov. 6 at Tesla’s annual meeting.
Earnings Report Takes Center Stage
Tesla reports third-quarter results on Oct. 22. Wall Street expects earnings of 55 cents per share, down from 72 cents a year ago.
The company delivered 497,099 vehicles in Q3. That marked a quarterly record and 7% year-over-year growth.
Strong delivery numbers could help beat earnings estimates. Investors want guidance on Q4 sales after the federal $7,500 EV tax credit expired in September.
Tesla launched lower-priced Model 3 and Model Y versions to offset the credit loss. Questions about robotaxi expansion will also feature in earnings discussions.
The company launched its robotaxi service in Austin in June. AI-driven opportunities have fueled the stock’s 99% gain over 12 months.
Technical Setup Points to $460
The stock broke above the $400 resistance level. That zone now provides support for further gains.
A golden cross formed as the 50-day moving average crossed above the 200-day. This pattern typically signals bullish medium-term trends.
Volume increased during recent rallies, confirming breakout strength. The RSI remains below overbought levels, suggesting upside potential.
Key resistance sits at $450 to $460. A close above $460 could open a path toward $500.
Downside support holds at $400 to $410. A break below that range would target the $370 area from Q2 2023 consolidation.
BNP Paribas initiated coverage with an “Underperform” rating and $307 target. Analysts see 29% downside, pointing to overreliance on unproven robotaxi and Optimus ventures.
Tesla defended Musk’s compensation in a post on X. The company said ISS “completely misses fundamental points of investing and governance.”
Tesla stressed that Musk earns nothing unless share prices rise materially. Ives maintains a Buy rating with a $600 target.
The stock trades at 180 times next year’s earnings estimates. That’s up from 70 times a year ago.
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