Tesla Stock Is Up. Elon Musk's EV Maker Is Investment Grade. -- Barrons.com
Dow Jones2026/09/22 11:36By Al Root
Tesla investors recently got some good news from Fitch.
The bond rating firm assigned the electric-vehicle maker an investment-grade BBB rating on Monday evening. It was Fitch's first rating, and signifies "good credit quality" with a low chance of default.
"Tesla's ratings reflect the company's strong market position as a global leader in battery electric vehicles (BEVs) and its focus on transitioning into a physical AI company," the report reads. Fitch expects that the BEV business will remain strong, but significant AI investments will lead to more debt down the road, which is why the rating might not be higher.
Tesla plans to spend some $25 billion on new plants and equipment in 2026, up from less than $9 billion in 2025. The company could fund that from its cash balance, but not solely from its EV business. Tesla is expected to spend about $10 billion more cash than it generates this year.
Tesla stock was up 0.7% in premarket trading at $377.87, while SP 500 and Dow Jones Industrial Average futures were up 0.1% and 0.3%, respectively.
Shares might not be up more because Monday was strong. Tesla stock rose 3% as the tech sector rallied. What's more, the Fitch rating mirrors existing ratings from Moody's and SP. And the new rating, while nice, doesn't really tell investors anything they don't already know about Tesla's spending plans or balance sheet.
Still, being investment grade is better than the alternative.
Write to Al Root at allen.root@barrons.com.
This content was created by Barron's, which is operated by Dow Jones Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
September 22, 2026 07:36 ET (11:36 GMT)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Citi optimistic about international oil companies: low-cost resource reserves being rebuilt may drive energy sector to reverse a decade-long valuation discount
With oil prices in the mid-$70s range, Citi believes that global international oil companies (IOCs) can deliver a free cash flow yield of 7% to 8%, and achieve a real growth rate of 4% to 5% over a period of time.
Honda Motor (HMC.US) Reports 65.7% Increase in Net Profit in the First Half, Plans to Expand Production Capacity in North America and Brazil
Honda Motor (HMC.US) released its financial results for the first half of fiscal year 2027 on November 10.
Crypto winter not over? Mining rig hosting provider Bitari cancels orders at the last minute, IPO plans put on hold
Bitcoin mining service provider Bitari has withdrawn its Nasdaq IPO plan. The company originally intended to issue 4.3 million shares at $7 per share to raise $30 million. Its annual revenue is approximately $11 million.
Crypto prices
More
