Tesla's Epic Squeeze: A Triumph of Batteries, Bulls, and Maybe a Trump Card

So, Tesla just wrapped up one of the wildest short squeezes in recent memory, and rumor has it that we can partially thank a certain former president for the fireworks. But let’s not get ahead of ourselves. First, let’s dissect this spicy soup of tax credits, battery ambitions, and the Tesla-Donald bromance — if we can even call it that.

Batteries Aren't Just Included, They're Changing the Game

Bloomberg Intelligence recently threw down an outrageously bullish take on Tesla’s “side hustle” — their battery division. According to Bloomberg’s crystal ball, Tesla’s battery business could make up 20% of its earnings by 2025, up from a humble 9% today. If that sounds like Tesla’s car business is about to get upstaged by a glorified power bank, well, that’s pretty much the angle. And if we’re talking about expectations, Bloomberg and Tesla fans already envision a revenue explosion fueled by a tax credit bonanza.

Speaking of these tax credits, they’re all the rage thanks to the Inflation Reduction Act. Essentially, the government is saying, “Hey, if you’re buying or making batteries, we’ll let you write off a fat chunk of it.” It’s like a two-for-one coupon on tax breaks — one for the buyer and one for the manufacturer. The credits add up to around 30% off for the buyer and an additional 10-15% for the maker. For those who love the thrill of a good deal, it’s practically Black Friday every day in the battery market.

The Trump Card in the Tax Deck

Enter Donald Trump. With his looming return to the political stage, there’s chatter that he could axe the tax credits on EVs and batteries. Now, if you listen to Musk, losing these credits would be “bad for our competition” — a nice way of saying, “The competition is already underwater, so let’s just toss them a life jacket with a hole in it.” In this grandstand of billionaires, Musk’s position is less about generosity and more about watching GM and Ford gasp for air. But, with Trump cozying up to Elon, it’s hard to imagine he’d cut the very subsidies Musk loves.

Why Elon Doesn’t Need Extra Drama

For those who think tax credits are just Tesla's insurance policy, Bloomberg points out that Tesla’s energy storage division might actually be the gem of the empire. They’re eyeing it to hit a net present value of $52 per share by 2025, which, in Tesla stock terms, might be the price of a nice weekend’s swing. Tesla’s Shanghai Mega Pack plant — a battery-producing behemoth — is cranking out packs at twice the capacity of its Lathrop sibling. If you’re wondering why people get excited about this stuff, that Shanghai plant isn’t just about scale. It’s about doubling Tesla’s revenue from energy storage alone, a business that Bloomberg says could rake in around $8 billion in gross profit. And for Tesla fans, $8 billion has a nice ring to it.

My Spreadsheet Beats Your Spreadsheet

Bloomberg’s not alone in their optimism. Tesla’s balance sheets are practically glowing with growth — maybe not “world domination” levels yet, but close. My own estimates are nearly aligned with Bloomberg’s in projecting Tesla’s energy revenue could hit around $26 billion by 2026. Although I had initially pegged this at a “modest” $18 billion, Bloomberg’s calculations have me reconsidering. They say if you take their estimates, you could bump up Tesla’s share price by $24. At this point, the difference between my estimate and Bloomberg’s might as well be just a couple more 0’s on a check — typical Tesla math.

Short Squeeze: Elon, Trump, and Zelensky Walk Into a Call…

The true drama, however, unfolded with a Tesla short squeeze of epic proportions. Reports suggest Elon had a call with Trump and Zelensky — two guys you wouldn’t expect in the same room, let alone on the same call. Yet, here we are. The financial world took this to mean that Musk’s sway over future EV policy could be more substantial than any of us imagined. Naturally, speculation went wild, and so did Tesla’s stock price.

If you were watching this live, it was like witnessing a soap opera with trading charts. Tesla broke through resistance levels like a hot knife through butter: $295, then $300, then $320. Watching it unfold was like watching dominoes fall in slow-motion — satisfying, nerve-wracking, and nearly unbelievable.

Rich PE Ratios and Historic Volatility

But let’s be clear: the numbers behind Tesla’s current price are as rich as Elon himself. Tesla trades at 92 times forward earnings, which is a bit indulgent, even for a Tesla fan. The reality check is that this sort of mooning doesn’t usually stick, especially in the face of a potential tax credit rollback, which could trim Tesla’s earnings and add a few gray hairs to the balance sheet.

To mitigate some of that volatility, selling options against Tesla at these highs isn’t the worst idea. Right now, historic volatility is on the high end, which makes it a prime time for savvy investors to consider selling calls. Think of it as placing a bet against the irrational exuberance — a way to cash in on Tesla’s moment of glory without betting the house. For instance, you could sell January 17th calls at a strike price of $330, netting around 8.6% if Tesla doesn’t sprint past it. It’s the classic "having your cake and eating it too" strategy — cashing in on the current highs while keeping your shares if the stock doesn’t blow through the roof.

Closing Thoughts: The Roller Coaster Continues

Tesla’s stock price, like its CEO, never fails to surprise. Between the short squeezes, political alliances, and ever-expanding battery ambitions, this company is a headline-generating machine. So, while Tesla’s current valuation might be as sky-high as one of Musk’s rockets, the excitement and speculative potential seem far from grounded.

For now, this short squeeze remains a spectacle, a Tesla-tailored thrill ride. And whether you’re selling options or holding tight, Tesla is as much a story stock as it is a tech juggernaut. If you can handle the volatility, enjoy the ride; just remember that with every high-flying stock, there’s bound to be turbulence along the way.