TL;DR

Tesla stock surges 50%+, $1T market cap regained; Musk pay under review; new 3% lawsuit threshold.

Highlights

• Tesla stock surged over 50% in three weeks, closing above $345, and reclaimed a $1 trillion market cap 316.
• The Tesla board formed a special committee (Denholm, Wilson-Thompson) to consider a new compensation package for Elon Musk after courts voided his previous $56–$87 billion pay deal 16.
• Tesla implemented a new bylaw requiring shareholders to own at least 3% (~$33 billion) of shares to file derivative lawsuits, following its move to Texas 1.
• Chipotle president Jack Hartung joins Tesla ’s board on June 1, 2025 8.
• Robyn Denholm, Tesla ’s chair, sold up to $310 million in stock amid profit declines, making her the highest-paid non-executive chair in the U.S. 5.
• Tesla ’s rally was fueled by optimism around potential AI and energy partnerships after Musk’s Saudi Arabia visit and renewed focus on robotaxi initiatives 1015.
• Mizuho raised its Tesla price target to $390, citing confidence in robotaxi plans 23.
• China’s NEV market reached 11 million units sold and 47.3% penetration; Tesla and BYD stocks hit new highs 19.
• Tesla ’s profits have declined despite the stock rally; shares remain down 8% year-to-date 13.
• Short-seller Jim Chanos disclosed a short position in Tesla , highlighting ongoing skepticism among some investors 18.
• Cathie Wood of ARK Invest projected Tesla stock could reach $2,600 by 2030 22.

Commentary

Tesla ’s stock rebound has been sharp, with a more than 50% gain in three weeks, returning the company to a $1 trillion market capitalization 316. This move aligns with strong performance across mega-cap tech stocks and was supported by investor enthusiasm around AI, energy partnerships, and the company’s robotaxi ambitions, especially after Elon Musk’s high-profile visit to Saudi Arabia 1015. Analyst sentiment has also turned more bullish, with Mizuho raising its price target to $390 23.

At the governance level, the board’s formation of a special committee to address Elon Musk’s compensation follows the court’s invalidation of his previous pay package 16. The new 3% ownership threshold for shareholder lawsuits, enabled by Tesla ’s shift to Texas incorporation, significantly raises the bar for legal challenges against management 1. The addition of Jack Hartung to the board may help strengthen oversight as these governance issues play out 8.

Operationally, Tesla faces ongoing margin and profit pressures, as reflected in recent profit declines and large stock sales by Chair Robyn Denholm 5. While the EV market—especially in China—remains robust, with record NEV penetration and strong sales, competition is intensifying, and Tesla ’s year-to-date performance remains negative despite the recent rally 1319. Short interest persists, with Jim Chanos publicly shorting the stock, signaling continued skepticism from some institutional investors 18.

Shareholders should monitor the outcome of Musk’s compensation negotiations, the impact of the new legal threshold on governance, developments in robotaxi and AI/energy partnerships, and competitive dynamics in China. Volatility may remain elevated as these strategic and operational issues evolve.