Tesla’s stock (TSLA) jumped by as much as 4% this morning – adding billions of dollars to its market capitalization.
The market is adjusting to the new reality that Tesla is now reaching an annual production rate of almost 1 million electric cars.
Tesla released its delivery numbers for Q3 2021 on Saturday, and it confirmed a new delivery record of 241,300 electric vehicles.
It significantly beat the market’s expectation of 222,000 vehicles and showed that Tesla could overcome supply chain issues that are affecting the whole auto industry right now.
The market couldn’t react until today when Tesla’s stock (TSLA) surged up to 4% despite the broader market being significantly down.
Wedbush Securities analyst Dan Ives released a new note to clients this morning about the great quarter results, which he says as a good sign for the near future:
“Taking a step back, with the chip shortage a major overhang on the auto space and logistical issues globally these delivery numbers were ‘eye popping’ and speaks to an EV demand trajectory that looks quite robust for Tesla heading into 4Q and 2022,”
Ives and Wedbush reiterated an Outperform rating on Tesla and a price target of $1,000.
Dan Ives is ranked #36 out of 7,676 analysts on TipRanks with an average success rate of 73% and an average return of 34%.
Not everyone shares his positive outlook on Tesla.
On the other hand, analyst Ryan Brinkman at JP Morgan increased his model and price target for Tesla from $180 to $215, but that still represents a significant downside on Tesla’s current valuation.
Brinkman argues that his model still makes Tesla the second most valuable automaker:
“While our new higher price target continues to imply material potential downside, we do not believe it is ungenerous, including as it values Tesla as the world’s second largest automaker by market capitalization (behind Toyota and ahead of Volkswagen), which is just one notch down vs. its current (admittedly by far) #1 position despite it ranking as only the 18th largest automaker by unit volume. Tesla fundamentals, including unit volume outlook, continue to improve, although its present valuation in our view continues to demand even more, as made clear when comparing its current market capitalization.”
Ryan Brinkman is ranked #6,028 out of 7,676 analysts on TipRanks with an average success rate of 61% and an average return of -0.6%.
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Author: Fred Lambert