By
Svetlana Soroka
April 18th, 2024
Tesla (TSLA) stock stays on bullish analyst radar. Piper Sandler analyst Alexander Potter believes that it may hit a $2,300 all-time high.
Tesla Inc (NASDAQ: TSLA) stock is one of Wall Street’s most volatile stocks as several analysts have given differing price calls since the past week. Undoubtedly investor’s favorite, Tesla’s stock has seen a tremendous rise from its 52-week low of $211 and currently trading above $1,516. The electric car manufacturer has beaten all odds spiked by the Coronavirus pandemic to post impressive Q2 car deliveries and profitability. Following the positive trend the company has been trailing, Piper Sandler analyst Alexander Potter has raised its price target for Tesla from its previous $939 to a new high of $2,322.
Tesla stock was up 3.25% after hours of trading on Wednesday to push up Tuesday’s bullish close of $1,516.8. At the time of writing TSLA stock price in the pre-market is 0.80%. Tesla shares have rocketed nearly 260% on the year and the stock’s valuation is 88 times higher than it was after its 2010 initial public offering.
Current Innovations Supporting Darling Tesla (TSLA) Price Target
According to Potter, Tesla can beat this new price target based on two pivotal factors which are the firm’s edge in manufacturing and resulting unit volume, and the possibility that emerging software will allow the company to eventually generate operating margins in the mid-2020s. Based on the manufacturing index, the fact that Tesla was able to deliver as much car deliveries as 90,000+ cars in Q2 2020 is an indication that the company’s structure has enough resilience to beat future demand. Tesla notably outperformed other electric car manufacturers such as Nikola Corporation (NASDAQ: NKLA) and Nio Inc (NYSE: NIO).
Potter believes Tesla can still complete its projected 500,000 vehicle deliveries in 2020 while scaling up in years to come. Piper’s speculations on increased operating margins on the basis of Tesla’s innovative software come on the growing use case of its Full-Self Driving feature (FSD). Tesla’s FSD software is an $8,000 add-on that provides advanced driver assistance over its standard Autopilot system. Piper believes that the FSD software will see growing demand in the near future which may stir the software’s price up to $40,000.
Potter noted:
“Thanks to the high-margin nature of the FSD package, we think that by the 2030s, Tesla could conceivably be selling vehicles at cost – or even below cost – while still achieving higher operating margins.”
Tesla has also recently secured tax-rebates for a Cybertruck factory in Texas. This news which will compliment Piper Sandler’s price call will help Tesla to create about 5,000 in Texas when the factory is completed.