What's next for Tesla's stock as shareholders and Wall Street pros weigh in

Tesla's stock performance dropped roughly 2.5% on the day following the shareholder vote. The forecast for its future performance remains uncertain, with some investors and analysts expressing skepticism. However, analysts like Wedbush's Dan Ives see Tesla's valuation surpassing $1 trillion in 2025 as Musk dedicates more time and focus to the automaker.

Tesla shareholders decided to reinstate Elon Musk's pay package for several reasons. Firstly, Musk has successfully led the company to achieve significant milestones, such as increasing Tesla's market capitalization and revenues. The original pay package was awarded in 2018 when the targets seemed virtually impossible, but Musk managed to meet them, which some shareholders believe warranted the reward.

Secondly, many shareholders may have feared that not reinstating the pay package could result in Musk leaving Tesla, which could negatively impact the company's performance and stock price. Musk's importance to the company was highlighted by some analysts and investors, who believe his leadership is crucial for Tesla's future success.

Lastly, the vote to reinstate the pay package could also be seen as a symbolic gesture of support for Musk and his contributions to the company. Despite the concerns about the size of the pay package, some shareholders may have felt that the deal should be honored since it was agreed upon in 2018.