Tesla Motors (NASDAQ: TSLA), the electric vehicle maker run by billionaire Elon Musk, just closed the books on its best year yet and Wall Street is cheering. Shares of Tesla revved to a record high Thursday after the company’s fourth-quarter results topped expectations and the company said it will sell 55 percent more cars this year.
It’s been an exciting year for the carmaker, and an exciting week for its passionate fans. On Tuesday, a San Francisco Chronicle report indicated that Musk had met with Apple’s head of mergers and acquisitions. It was unclear what if anything transpired as the result of the meeting, which happened early in 2013. In an interview on Bloomberg Television, Musk confirmed that the meeting took place but declined to comment on whether the talks touched on an acquisition.
Tesla shares, which have surged nearly 450 percent over the past year, reached a new closing record of $203.70 on Tuesday and jumped as high as $215.21 today. That gives the company a market valuation of more than $25 billion.
Apple stock, by contrast, has underperformed the broader market over the last 12 months as investors question how it will generate future growth. An Apple purchase of the carmaker is extremely unlikely, analysts say, but the chatter highlights the uncertainty about what new product categories the iPhone maker might enter.
Also, the high-tech speculation is a whole lot of fun, especially since Apple’s rival Google has been working to revolutionize the auto industry with a self-driving car. According to media reports, the search engine giant is in talks with several automakers about the technology it has been developing.
“I can see it now,” says Sean McAlinden, vice president for research at the Center for Automotive Research, in an interview. “Apple-Tesla versus the Google automated cars.”
Discussion about a potential tie-up with Apple or any other partner is bound to come up when Tesla reports its quarterly results Wednesday evening. Expectations for the Palo Alto, Calif. Company are high. Revenue in the December quarter is expected to more than double to $679 million. Analysts expect profits of 22 cents per share.
In a note to clients, Robert W. Baird analyst Ben Kallo wrote that there was an “outside chance” Tesla would announce plans for a second production line. The company is producing about 600 cars a week and would probably deliver about 29,000 of its popular Model S vehicles this year. Telsa, however, also is facing competitors such as BMW, DaimlerBenz Audi and General Motors’ (GM) Cadillac, so investors will be on the lookout for any announcements related to its technology.
Apple has long been interested in the automotive sector. Chief Executive Tim Cook told analysts last year that having its operating system in cars was “very, important” and a “key focus” for the iPhone and iPad maker. “It’s part of the ecosystem,” he said, likening cars to iTunes and the App Store.
The company’s late CEO and co-founder, Steve Jobs, reportedly told John Markoff of The New York Times that he would have liked to have developed an Apple car if he had the energy to do so. Veteran Apple executive Eddy Cue is on the board of Ferrari while Phil Schiller, who runs marketing, likes to Tweet pictures of his favorite cars.
Musk, who made his fortune as a co-founder of PayPal, has said he might one day unload Tesla, but he said he plans to stick around for several years. Though there have been reports that Musk would sell to one of the automakers, McAlinden doesn’t see that happening.
“They really hate Telsa,” he said of established car manufacturers. “The Google car and Tesla are the most nagging problems facing the automotive industry worldwide.”
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