Jeff Bezos may the world’s richest person in the world but it’s Elon Musk who has been attracting the eyeballs of everyone for the last few weeks.
The net worth of Elon Musk, the serial entrepreneur and visionary co-founder of Tesla Motors, SpaceX and few other futuristic companies, has been skyrocketing like never before. The recent rise in his net worth is a result of Tesla’s getting added to the S&P 500 Index last week.
But a closer look at the rising net worth of Elon Musk tells us a lot more about his increasing clout on the market and increasing dominance in self-driving car market and space missions.
The astronomical gains of 594% in Tesla’s stock value in the last one year has pushed the net worth of its CEO to a new height. Tesla stock was trading at just $70 on November 20, 2019. From the beginning of this year, however, Tesla’s stock started rallying, achieving new milestones. Yesterday, the market closed with Tesla stock price reaching an all-time high of $499 which has made Elon Musk net worth $123 billion, according to Bloomberg Billionaire Index.
Since the beginning of this year the stock price of Tesla increased by 455%, taking the company’s market cap to $473 billion.
Elon Musk, now a centibillionaire, whose net worth was estimated just $22 billion a year ago, added $101 billion dollars to his net worth in the last 12 months. In 2020 alone, Elon’s net worth increased by $95.3 billion, making his the third richest person in the world now.
Quite recently he leapfrogged Mark Zuckerberg whose net worth is estimated $103 billion. As Tesla’s stock price continues to rise, he is fast closing the gap with Bill Gates whose is just $5 billion ahead than Elon Musk now.
Musk’s net worth is almost as volatile as Tesla’s stock. Unlike many of top billionaires in the list, Elon holds a sizeable number of share of Tesla. As a result, he makes more money when the stock goes up; he gets compensated as Tesla’s market capitalization, or valuation, reaches predetermined thresholds. Elon holds 21% of Tesla stocks and doesn’t draw any salary for himself.
But, Musk has a long way to go before it top the list of world’s richest people. The title is currently held by Jeff Bezos, Co-founder – Amazon.com Inc., whose has added $68.7 billion to his net worth so far this year. Bezos net worth gains have been similar to Elon as Amazon valuation soared nearly 67% since the beginning of this year. However, he holds 10.88% shares of Amazon, which provides Elon Musk with an edge when it comes to net worth.
All of it is paper valuation and paper net worth and are pegged to the company’s share value which changes on a daily basis. The market is divided on the stability of Tesla’s stock value as some analysts believe that such growth in the valuation of an Electric Vehicle company is beyond acceptable logic.
Jim Cramer, a CNBC analysts, sees Tesla as “a new species discovered in the wild”.
i don't even know if it is a stock. it is something else entirely, like a new species discovered in the wild. https://t.co/Wplhsv1hkg— Jim Cramer (@jimcramer) July 20, 2020
Whether such jaw-dropping growth of Tesla is sustainable or just a flavour of the month, only time has an answer to that question. But the way Elon Musk net worth is increasing, and considering the stakes it has in Tesla, don’t be surprised to see Elon waving hand sitting at the top of the world’s richest people list after dethroning Jeff Bezos anytime next year.
What are your views on Elon Musk’ dream ride? Do let us know your views in the comment section below.