Tesla (NASDAQ:TSLA) shares climbed 7.7% in premarket trading on Monday, reaching $345.50, poised to extend a rally that saw the stock gain more than 3% in the previous session.
The electric vehicle maker's shares have surged over 27% since November 6, when Republican candidate Donald Trump secured a second term as U.S. president.
Barclays responded to the stock’s momentum by raising its price target for Tesla by 15% to $270 while maintaining an "equal weight" rating.
In its analysis, Barclays noted that while Tesla's fundamentals remain largely unchanged, CEO Elon Musk’s elevated role in Trump’s inner circle underscores what the bank termed "key man risk."
Musk’s involvement in the new administration also reinforces the "Elon Musk premium" that has long been associated with Tesla’s valuation.
Tesla has emerged as a significant beneficiary of the so-called "Trump Trade," a market phenomenon favoring stocks that could benefit from Trump’s policies.
Meanwhile, Bloomberg News reported over the weekend that Trump’s transition team is exploring measures to ease regulations on self-driving cars—a development that could potentially bolster Tesla's prospects in the autonomous vehicle sector.
The company’s visibility has also grown with Musk's appointment as co-leader of the newly established Department of Government Efficiency, alongside former Republican presidential candidate Vivek Ramaswamy.
Observers suggest this move could further cement Tesla’s influence in shaping regulatory landscapes that impact the industry.