Volkswagen has to show more than healthy profits on conventional cars to live up to its current share price.

On Thursday, the German automotive giant reported first-quarter operating profit of €4.8 billion, equivalent to $5.8 billion and above FactSet consensus expectations of roughly €4.3 billion. It also raised its forecast for its full-year operating margin to between 5.5% and 7%. The upgrade offers reassurance that VW isn’t being overly affected by the chip shortage, but wasn’t hugely surprising. Analysts already expected a 6.9% operating margin on average, according to FactSet. The shares barely moved.

VW investors are focused on other things, most notably the company’s electrification strategy. VW has pitched its ID.3 sedan and ID.4 crossover as the leading competitors to Tesla’s Model 3 and Model Y. Amid intense interest in electric vehicles more generally, the capital markets are giving it credit, notably in the U.S. VW’s ordinary shares are up 54% this year, led by trading in their American depositary receipts.

Even after a recent correction, the ordinary shares trade at roughly nine times forward earnings. While that is very cheap compared with Tesla, it is more than VW’s local peers, Mercedes owner Daimler and BMW , which, like their car brands, have traditionally fetched a premium. VW’s preference shares, an economically identical security that is more widely traded in Europe but offers less liquidity in the U.S., are slightly cheaper, but well above historical valuation levels.

A lot is riding on the rollout of VW’s new EVs. They have garnered largely positive reviews, and VW sold almost 60,000 all-electric vehicles in the first quarter as it ramped up production. But that was just 2.5% of the company’s total sales. It remains far too early to know if the products will follow the VW Beetle and VW Golf in opening a new era, as hoped. Tesla sold almost 183,000 of its Models 3 and Y in the quarter.