There are a number of ways to buy Tesla stock, but the simplest are to do it either through a brokerage account or with the help of a financial advisor. Tesla is one of the most popular and innovative American electric vehicle companies. Headed by CEO Elon Musk, the company designs, develops, manufacturers and distributes a variety of electric cars and vehicle powertrain components. In addition, it provides energy storage and generation products. Tesla’s success and global international product offerings have many investors looking to buy equity. But how do you invest in Tesla stock? We go over your options below. If you’d also like expert guidance with your financial decisions, consider using a financial advisor matching tool to pair you with local advisors in your area.
How to Buy Tesla Stock With a Brokerage Account
Tesla is a publicly traded company, which makes its stock available to anyone of age interested in purchasing equity. In order to become a shareholder, you’ll need to open a brokerage account. You’ll have a range of brokers to choose from, but it’s wise to choose the one that best complements your financial situation. Brokers offer varying account minimums and trading commissions, so you’ll want to weigh your options before making a final decision.
If you’re worried you may not have enough money to purchase an entire share of Tesla, other services, such as Motif Investing, allow investors to buy fractional shares of equity. After you’ve selected your broker and determined how many shares you’d like to buy, you’ll be ready to place an order. You’ll need to use Tesla’s ticker symbol on the Nasdaq — TSLA — to proceed. You’ll then have the option between two orders: a market or limit order. Specifically, a market order allows you to purchase a company’s stock at whatever the current price is. However, a limit order lets you dictate the maximum or minimum price at which you’re willing to buy or sell.
|Brokerage Firm||Trading Fees||Minimum||Best For|
|$0||$0||– Mobile/online traders |
– Self-sufficient investors
|Merrill Edge |
|$6.95||$0||– Bank of America account holders |
– Customer support users
|TD Ameritrade |
|$6.95||$0||– Online traders |
– Customers who value support
How to Buy Tesla Stock With a Financial Advisor
You may also want to consider an alternative to consulting a brokerage. If you’re looking for expert guidance with your investment portfolio, a financial advisor could be a great option for you. If you’re new to investing, or even if you’ve got a bit of experience, financial advisors could present a holistic approach to transforming your finances. Whether it’s structuring your portfolio, or determining which investment types to use, financial advisors can help you meet your long-term savings goals.
How to Buy Tesla Stock: Company Overview
Founded in 2003 and headquartered in Palo Alto, California, Tesla designs, builds and sells both innovative electric vehicles, energy generation products and storage products. Sales are global. In fact, its product distribution extends to China, Europe and Australia.
The company operates in two primary segments: automotive and energy generation and storage. The automotive segment focuses mainly on electric vehicles and electric vehicle powertrain components. The segment additionally offers vehicle services and benefits like Tesla Leasing and Tesla Lending. The energy generation and storage segment, on the other hand, sells solar systems and renewable energy and offers energy storage products.
|Tesla Company Overview|
|Automotive||– Sedans and sport utility vehicles |
– Electric vehicle powertrain component
– Tesla Leasing, Tesla Lending
– Vehicle services
|Energy Generation and Storage||– Energy storage products |
– Solar systems
– Renewable energy
Besides products that are innovative, Tesla may soon accept payments in a way that is innovative. In February 2021 Tesla said it may begin accepting “bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.”
But just three months later, Musk announced via Twitter that “Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy.” The company also said in its Q2 2021 report that it took a $23 million loss on its initial Bitcoin bet. Though speculation was stirred again when Musk said during a virtual panel discussion in July that Tesla would most likely accept Bitcoin payments again after it becomes more eco-friendly.
Tesla’s Financial Profile
Though an incredibly popular company, Tesla’s stock hasn’t received blue-chip status. When a company earns blue-chip status, that means it has a longstanding history of profitability and success in its industry. Tesla doesn’t retain the status largely because of its rocky profitability history.
In early January 2021, Tesla shares rose over $800, hitting a new 52-week high. The 52-week low was $70.10. In July 2021, the company hit another milestone in Q2, with $1.1 billion reported in profits. Only roughly one-third ($354 million) came from regulatory credit sales, which is the first time Tesla made more money from automotive and energy storage sales.
By November 2021, Tesla shares reached another milestone, rising over $1,200. But investors demonstrated concern again in April 2022 when Tesla stock fell 12% after Twitter approved a $44 billion acquisition deal from CEO Elon Musk. If approved, the deal could put Musk in charge of Tesla, SpaceX and Twitter.
Note that past performance does not guarantee future results. This chart is from April 2022.
Tesla’s stock has also undergone numerous ups and downs in 2018, and Musk reported that the company was on the verge of bankruptcy. However, Tesla announced that it was making severe cost cuts to become more profitable.
If you’d like a more holistic view of the company, it may also help to review its Form 10k. The Form 10K is an annual report that all publicly traded companies must file with the SEC. It highlights everything from a company’s management and risks, to its expenses and total revenue.
Should You Buy Tesla Stock?
Before deciding whether you should purchase Tesla stock, it’s wise to assess your financial situation and long-term savings goals. While Tesla is a widely recognized and popular company, its stock is nonetheless susceptible to volatility.
The company’s surging stock at the end of 2020 and the beginning of 2021 has made CEO Elon Musk the richest person in the world, overtaking Amazon’s Jeff Bezos. But while Tesla’s back-to-back record highs have exceeded many of Wall Street’s forecasts, top investors are divided. More specifically, some maintain that the stock could be worth even more, while others are poised to bet against it.
Hedge-fund manager Michael Burry, who became famous in the book and movie “The Big Short” for shorting the housing market in 2007 by buying credit default swaps against subprime mortgages, said in December 2020 via Twitter that he was betting against Tesla. Short sellers, however, took losses against Tesla’s sustained rally, and Burry’s tweet is now deleted.
Depending on how much risk tolerance you are willing to take on your investments, buying Tesla stock at such a high valuation might be too risky. Investors with a higher risk tolerance might be interested in buying and holding the stock for a number of years, while expecting volatility. Others looking to diversify may want to trim their Tesla holdings so that they don’t outsize other investments in their portfolio.
Your decision to invest will be largely based on your faith in the company’s current and future performance. Both qualitative and quantitative factors are all important considerations in determining where to invest. Before purchasing equity, you should weigh things like Tesla’s total revenue, management, risk and competition. If you’re confident in CEO Elon Musk’s vision for the company’s future, Tesla could be a worthwhile investment.
Tips for Picking a Financial Advisor
- Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Investing is a good way to continuously grow your wealth. And while stocks are an obvious choice for your investments, our beginner’s guide will walk you through other types of investments, including bonds, mutual funds, ETFs and CDs that will make your money work for you.
- Whether you’re getting started with investing or you’re already a seasoned investor, SmartAsset’s investment calculator can help you figure out how to meet your goals. Calculate how much your investment will be worth by adding your starting amount and the number of additional contributions.
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