Elon Musk says Tesla (TSLA) could soon be worth more than Apple (AAPL)

Elon Musk says Tesla (TSLA) could soon be worth more than Apple (AAPL), and the company is investing its money in that position with a $5-10 billion share buyback.

Today, Tesla released its third-quarter 2022 financial results. The automaker posted a small revenue loss based on expectations, but beat profit expectations.

Tesla has struggled in the stock market in recent months, and third-quarter results haven’t helped.

After the earnings release, Tesla held a conference call with analysts in which CEO Elon Musk took the microphone in a clear attempt to calm investors down. The CEO began by announcing that Tesla’s board had discussed a stock buyback program, and he agrees that a $5 billion to $10 billion stock buyback would make sense.

A share buyback program is for a company to buy back its own shares at market price. This is usually a sign that the company thinks its stock is undervalued and is a way to drive up the stock price.

Musk said the plan isn’t finalized, but it looks like Tesla will be moving forward with a stock buyback program soon.

After announcing the buyback program, the CEO commented on Tesla’s valuation:

I said on an earnings call a while ago that I thought Tesla might be worth more than Apple, which was worth around $700 billion at the time.

Tesla is now worth around $700 billion based on its market capitalization.

Now Musk has a new target for Tesla’s valuation:

Now, I am of the opinion that we can far exceed Apple’s current market capitalization. I see a way for Tesla to be worth more than Apple and Saudi Aramco combined.

Apple is now worth $2.3 trillion and Saudi Aramco is worth around $2 trillion.

The CEO also pointed out that even in a bad recession, Tesla could still generate “significant cash” next year. Hence his conviction that it would be wise to initiate a share buyback program.

Musk does not include Tesla Optimus, the company’s planned humanoid robot, in his equation, and says it would take hard work, excellent execution and a bit of luck to get Apple and Aramco’s valuation. .

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