Tesla shares increase 13% as strong deliveries drive profit optimism

by SpeedLux
Tesla Inc logo

Shares of Tesla Inc increased 13% to a record high on Monday, extending their rally to more than 40% in five sessions after analysts raised their price targets on the electric automaker following its strong quarterly deliveries.

The day’s jump has boosted Tesla’s stock market value by $30 billion, eclipsing the entire value of Ford Motor, currently at $25 billion.

JMP Securities boosted its price target to $1,500 from $1,050 after Tesla on Thursday reported high second-quarter vehicle deliveries, defying plummeting sales in the wider auto industry as the coronavirus pandemic hit the global economy.

“We believe that the question to be considered is not whether the stock is expensive on present valuation measures, but what the company’s growth and competitive position signal about the stock’s potential for the next several years,” JMP Securities analyst Joseph Osha wrote in a client note. Osha predicted that Tesla’s annual sales could hit $100 billion by 2025.

JPMorgan, which rates Tesla “underweight,” raised its price target to $295 from $275, while Deutsche Bank increased its target to $1,000 from $900. The median analyst price target for Tesla is $675, compared with its present price of $1,372, according to Refinitiv.

The automaker’s solid delivery figures heightened expectations of a profitable second quarter, which would mark the first time in the automaker’s history that it would report four consecutive quarters of profit.

However, with Tesla’s stock up almost 500% over the past year, many investors believe the rally is unsustainable. The stock is trading at 158 times expected earnings, Refinitiv noted, an exceptionally high valuation.

After Monday’s surge, Tesla’s market capitalization stood at $245 billion, increasing its lead as the most valuable automaker globally.

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.


SpeedLux is a high-authority automotive blog providing the latest automotive news and reviews. SpeedLux covers everything related to cars, bikes, and motorcycles, from news and reviews, to troubleshooting guides, tips and tricks, and more. SpeedLux was born in 2009 and we have over 20,000 articles published on our blog. We thank all our readers, as well as our partners, without whom we could not have reached this level.


©2009 – 2024 SpeedLux – Daily Automotive News and Reviews. All Right Reserved.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More