Today Tesla Motors went IPO and the stock soared in spite of a very weak market. Here is an excerpt form CNBC: Shares of electric carmaker Tesla Motors Inc opened nearly 12 percent above their initial public offering price on Tuesday as investors bet that electric cars would define the future of transportation. Tesla's shares were still up 10 percent in afternoon trading despite weakness in the broad market and as other auto stocks were hit by concerns of a global slowdown. Tesla, which at the IPO price of $17 had a market capitalization of $1.6 billion, is the first initial public offering by an American automaker since Ford's debut in 1956. The IPO comes amid heightened interest in electric cars and as major automakers gear up to launch various types of battery-powered vehicles, including plug-in hybrids.
"They're competing against both internal combustion engines and alternative fuels like fuel cells, compressed natural gas and things like that," said Matt Therian, an analyst with Connecticut-based IPO research house Renaissance Capital. "It's probably too early to say that electric vehicles are definitely going to be the next thing in cars, but if they are I think the potential is huge." Analysts say that the cars may be sleek, but the shares will be volatile in the near term. The Palo Alto, California-based company is losing money and does not expect to be profitable for at least two years. "A lot of people were puzzled about why we were going public without profits," CEO Elon Musk, dressed in jeans and wearing a plaid blazer and a shepherd's checked shirt, told reporters outside the Nasdaq building in Times Square, near several Tesla Roadsters. "The reason we are not profitable today is because we are in the midst of expanding with the Model S (sedan)," Musk added. The IPO is also the first for the eccentric and charismatic Musk, who is the inspiration for Robert Downey Jr's Tony Stark character in "Iron Man" and also has a cameo role in this summer's sequel. The serial entrepreneur, who turned 39 on Monday, previously sold most of his bigger ventures, including online payment company PayPal to eBay for $1.5 billion in 2002. Track the stock via CNBC
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