Rumors of a possible acquisition by Apple and expectations for a strong fourth quarter drove shares of Tesla Motors to $203.70 Tuesday, a 3% gain and a new closing high for the electric car company.

It was the first time Tesla closed over $200.

Investors were reacting to news of a meeting between Elon Musk, Tesla’s chief executive officer and co-founder, and Apple’s Adrian Perica, a former Goldman Sachs investment banker who heads Apple’s mergers-and-acquisitions team, analysts said.

The meeting occurred in early 2013, but was reported by the San Francisco Chronicle this week, citing unnamed sources.


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“There is a lot of pressure on Apple right now to find new markets to grow in,” said Craig Irwin, an analyst with Wedbush Securities.

But Apple taking a bite of the Tesla seems unlikely, he said.

Tuesday’s closing stock price left Tesla with a market valuation of $25 billion, about $1.1 million for each of the 22,450 Model S cars it sold last year. The cars sell for $70,000 to $100,000, depending on options.


And that market valuation doesn’t include any premium Apple would have to toss in as part of an acquisition.

“Apple does not have a history of paying massive premiums,” Irwin said.

Indeed, the computer and telephone maker has never tossed around the billions to purchase companies in the same way that technology rivals Google and Microsoft have.

“I see this as highly improbable,” Irwin said, “But it is one of the things that drives enthusiasm for the stock.”


If there was real evidence of any merger talks, Tesla’s stock would have closed much higher than a 3% gain, said Thilo Koslowski, an analyst with Gartner Inc.

Koslowski said it should be no surprise that senior executives from Tesla and Apple have met. Tesla also has likely talked to Google, he said.

“It is a natural, these are technology companies in Silicon Valley,” he said. “They would talk together to see where there would be synergies.”

But the profit margins in the auto business are so much lower than in consumer electronics that it is unlikely Apple would take a chance on a company such as Tesla.


“There could be a collaboration but not likely a takeover,” Koslowski said.

Tesla is scheduled to announce its fourth-quarter financial results Wednesday and Musk is likely to be asked about the Apple rumor on the teleconference that accompanies that automaker’s release.

So far both companies have declined to comment.

Tesla shares have been on a run. The stock has risen 47% since hitting its low of the year of $139.34 on Jan. 13.


There is news expected from Tesla that could explain why Musk was meeting with a senior Apple executive.

Last month he said Tesla plans to build “the biggest battery plant in the world by far and we’ll do it in partnership with some other companies.” The announcement is expected sometime this month.

Panasonic, already a Tesla shareholder and a big supplier of batteries for the Palo Alto automaker’s electric cars, is an expected partner. But Apple, which is also a big battery user, would also seem like a potential partner in such a venture.

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