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The best days are still ahead for Tesla -not in the rear view mirror, Wedbush says.
In a Monday note, senior technology analyst Dan Ives said that despite near-term speed bumps, he remains firmly bullish on Tesla and the broader electric vehicle theme. He reiterated his “outperform” rating and price target of $1,000, a nearly 67% jump from current levels.
The first half of the year has been off to a rough start for Tesla. The stock is down nearly 15% year-to-date amid autopilot safety concerns, chip shortages, negative PR, and a clamping down by Beijing around Tesla. This has all contributed to a softer demand for Tesla in China, Ives said.
But the analyst sees “transformational consumer demand” in China doubling electric vehicle deliveries in the key region over the next two years, with Tesla majorly benefiting along with Nio, Xpeng, and Li Auto.
“With China a linchpin to Tesla’s global success and its Giga footprint a key advantage, the latest back and forth between Beijing and Tesla have clearly negatively impacted demand for Tesla in China for now,” said Ives. ” Now its about Musk playing nice in the sandbox and making sure that Tesla does not see any further stumbles in China which is poised to represent 40%+ of global deliveries by 2022.”
Additionally, new electric vehicle tax rebates in the US will be a catalyst for growth domestically, he said.
Tesla slipped as much as 1.4% premarket Monday as the EV maker announced it called off plans to build the Model S Plaid+, a longer-range version of its high-end sedan.
Elon Musk tweeted on Sunday the Plaid+ is canceled because the Plaid is “just so good.”