[alexmingoia]

Stock prices do not reflect future earnings or company fundamentals, despite popular belief. The price of tradable assets with zero possible earnings demonstrate this.

Stock price is purely a function of supply and demand, and the demand does not have to be based on any sort of rational expectation of earnings. Price psychology is the biggest factor in my experience. People often buy for no reason other than the price moving up, which creates a cycle of upward price pressure which continues until enough decide to sell to take a profit, or there are no more buyers. This usually has little to do with company fundamentals like earnings. Day trading is pretty much based entirely on this logic, looking only at price and volume.

The lack of past profit actually fuels a higher price for Tesla, because it allows for imagining bigger profits in the future. A company that has a history of profits leaves little to the imagination. The story matters more than reality.

At the macro level, yield had dried up everywhere but stocks, combined with the Fed giving money to prop traders and signaling that they will buy junk assets and attempt to stop the market from crashing through any means possible. The market has become saturated with day traders and swing traders (retail and institutional) looking for volatility and price movement more than earnings or fundamentals, and newer stocks like Tesla attract them over established stocks like Toyota.