No stock can rise parabolically and stay there forever; prices will eventually come down to a consolidated state. This is the case of Tesla Inc. After a surprisingly good 2020, this EV manufacturer’s stock has gone through a period of stabilization since the beginning of this year.
In any case, the trends could be changing again for the company. It remains a strong brand and has a hugely loyal customer base. On July 26th, Tesla expects to release its earnings report for the last quarter after the U.S Markets close.
Analyst Daniel Ives of Wedbush Securities believes TSLA has been consolidating over these past six months due to new entries into the Electric vehicle market, strong stances from Chinese regulators, and the infamous semiconductor chip shortage affecting all tech companies.
Ives assigned TSLA a Buy rating on the stock, with a price forecast of $1,000 next year. This suggests a scenario of a 12-month upside of 52.6%.
The analyst bases his bullish forecast on faster delivery dates for the Chinese market in the latter half of 2021 and the beginning of 2022, which could eventually represent an average of 40% of all Tesla’s sales. He added that Tesla accomplished over 200,000 deliveries over the past Quarter.
Tesla is currently the market leader in EVs, and has products nearing the end of the pipeline, such as its highly expected Cybertruck.
Ives calculated that EVs now represent about 3% of the worldwide auto industry. A share he believes will increase to 10% by 2025, and the market to be worth about $5 trillion by 2031. Tesla is expected to be a significant player in that scenario. TSLA has an average analyst rating of Hold. The average assigned TSLA price forecast is $658.27, implying that shares have almost peaked at price.
Has TSLA peaked already? Or are you part of the bullish sentiment? Let us know!
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