Market capitalization of “Tesla” and “ExxonMobil”
There was no escaping the symbolism of skipping a massive increase in Tesla’s market capitalization.Exxon Mobil“, one of the major oil giants, in June 2020. By the beginning of this year, “Tesla” was 350% larger than “Exxon”. But a lot of events occurred during the intervening 12 months (approximately), especially the past two months (approximately).
Exxon buys back $50 billion worth of shares following record profits
Russia invaded Ukraine, sending the oil markets into a frenzy (which is good for Exxon). Then Musk conquered the platform.TwitterWhich drove everyone crazy (which is not good for Tesla). Last Thursday evening, the platform experienced more turmoil, as Musk suspended the accounts of a number of journalists for questionable reasons, and published, in his unique form, the term “assassination coordinates.”
Today, Tesla is only 16% larger than Exxon. It is possible to exaggerate the symbolism. Oil consumption did not end in 2020, and electric vehicles are not going away today. Over those 30 months, though, it is notable that Exxon’s rehabilitation owes some credit to the unlikely success of an activist hedge fund.
The Engine No. 1 fund capitalized on investor disappointment with Exxon’s high spending and poor returns to push changes to the board and strategy. The oil boom explains Exxon’s shares have soared since then, but the renewal of capital discipline has also been important. The stock reached an all-time high last month.
