Investors may want to use Tesla (TSLA) weakness as an opportunity.
After pulling back from around $1,250 a share, the EV stock appears to have caught strong support around $950. From a current price of $1,046, we’d like to see it test $1,250 again soon. From there, analysts like China Securities’ Zhu Yue say the stock could hit $1,485.
Shortly after, New Street Research analyst Pierre Ferragu raised his target to $1,580.
Analysts at UBS raised their target price on TSLA to $1,000 from $725.
Not to be outdone, we believe it could run to $1,650.
Ferragu says earnings upside, strong production from Tesla’s Shanghai facility, new production capacity in Germany and Texas, and new batteries could fuel upside, as noted by Barron’s.
“For the fourth quarter, Ferragu expects Tesla to deliver about 283,000 vehicles. Wall Street projects about 266,000. What’s more, Ferragu expects about 1.5 million vehicles sold for Tesla in 2022. Current Wall Street estimates for 2022 deliveries range from about 1.3 million to 1.4 million units,” they added.
What we also have to consider is that electric vehicle demand is only expected to ramp up.
According to Bloomberg, “Drivers around the world will buy about 5.6 million electric passenger vehicles this year, according to a new report from BloombergNEF released in concert with the COP26 United Nations Climate Change Conference. That’s almost double the number purchased last year and represents almost 8% of all vehicle sales.”
They added, “Electric vehicles (EV), including battery electric and plug-in hybrids, made up 7.2% of global car sales in the first half of 2021, up from 2.6% in 2019 and 4.3% in 2020, according to new data from BloombergNEF. In North America, EVs made up 3% of sales in the first half but industry observers say 5% is possible as second half sales pick up.”
With the EV boom only set to accelerate, Tesla could be one of the biggest beneficiaries.
