Tesla cracks $500 for the first time after the new most bullish analyst on Wall Street says the stock will surge 28% this year (TSLA) | Markets Insider
On Monday, Colin Rusch of Oppenheimer raised his Tesla price target to $612 from $385. It's now the highest price target on Wall Street for the company and 28% above Friday's closing price. Shares of Tesla surged as much as 5.6% Monday and traded above $500 per share for the first time ever. While Tesla has "stumbled through growing pains, we believe the company has reached critical scale sufficient to support sustainable positive FCF," Rusch wrote in the Monday note. Watch Tesla trade live on Markets Insider.
Shares of Tesla surged as much as 5.6% early Monday, trading above $500 for the first time ever after an analyst at Oppenheimer released the new highest price target on Wall Street. Colin Rusch of Oppenheimer raised his Tesla price target to $612 from $385 Monday and reaffirmed an "outperform" rating. The price target is handily the most bullish on Wall Street, beating out Piper Sandler's $553 target and Canaccord Genuity's $515 target. The new most bullish price target is also roughly 28% higher than where shares of Tesla traded at Friday's close. While Tesla has "stumbled through growing pains, we believe the company has reached critical scale sufficient to support sustainable positive FCF," Rusch wrote in the Monday note. Rusch raised his price target to $612 based on a 30x multiple of his 2024 non-GAAP earnings-per-share estimate of $28.67, discounted three years at 12%. Rusch sees Tesla as a "must-own" stock that could benefit from inclusion in additional indexes. "We believe the company's risk tolerance, ability to implement learnings from past errors, and larger ambition than peers are beginning to pose an existential threat to transportation companies that are unable or unwilling to innovate at a faster pace," he wrote. In addition, Tesla's powertrain technology, power and data architecture, and operating system are about three years ahead of the competition, based on available vehicles and checks on new platforms, Rusch wrote. The latest leg of Tesla's recent rally was also fueled Monday when the Chinese government signaled that it won't continue reducing subsidies for the electric vehicle industry at the same pace this year, Bloomberg reported. Tesla stock has doubled since a surprise return to profitability in the third quarter of 2019. The Elon Musk-led automaker started the year off strong when it announced in early January that it delivered more vehicles than the low end of its guidance. The stock rally continued when Tesla opened its Gigafactory in Shanghai and began delivering the first vehicles made there to consumers. The recent gains have made Tesla the highest-valued US automaker ever, and have brought its market value to more than Ford and GM combined. Tesla has gained 14% year-to-date through Friday's close. Join the conversation about this story » NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption
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Virgin Galactic has gained nearly 150% this year through Friday's close in a speedy rally that's...Virgin Galactic has gained nearly 150% this year through Friday's close in a speedy rally that's outpaced automaker Tesla's torrid 91% rise in the same timeframe. Shares of the space tourism company surged as much as 35% to a new high in early trading on Tuesday. Adam Jonas of Morgan Stanley thinks the stock price could "use a breather." While he's constructive on Virgin Galactic, "the move in the stock price of late appears to be driven by forces beyond fundamental factors," he wrote in a Tuesday note. Watch Virgin Galactic trade live on Markets Insider. Read more on Business Insider. Virgin Galactic is rocketing higher in a rapid surge that's even outpaced Tesla's record-breaking rally. So far in 2020, Virgin Galactic has gained a searing 148% through Friday's close. In the same timeframe, Tesla has gained 91% in a torrid rally that's led analysts and traders to question the stock's underlying fundamentals. The space company founded by Sir Richard Branson continued to beat the automaker's gains this week. Virgin Galactic spiked as much as 35% in early trading Tuesday to a fresh all-time high of $38.72 per share, while Tesla gained as much as 8%. Virgin Galactic's momentum is continuing from Friday when the stock closed 21% higher after the company announced that it had moved its spacecraft VSS Unity from Mojave, California, to New Mexico, where it will one day shuttle passengers to and from space. The recent rally has led at least one Wall Street analyst to question the stock's climb, saying that the share price could "use a breather." "We are constructive on the story and rate the stock overweight," Adam Jonas of Morgan Stanley wrote in a Tuesday note. "However, we must acknowledge that the move in the stock price of late appears to be driven by forces beyond fundamental factors." When Morgan Stanley first initiated coverage of Virgin Galactic in December, its $60 bull-case target represented over 700% upside, he wrote. Today, however, the shares have about 100% upside after just two months. Jonas also wrote that while Friday's move of the VSS Unity had "some important learnings," he didn't see it as one of the more ambitious tests for the company. "We believe the investment community still has much more room to better understand the potential of the emerging space economy," he wrote. In the future, Morgan Stanley thinks the company could even move beyond the $60 bull case as it "executes on key milestones and moves from proof-of-concept to industrial and commercial success." Virgin Galactic has a consensus price target of $18.50 and three "buy" ratings according to Bloomberg data. The company is due to report is fiscal fourth quarter 2019 earnings on February 25 after market close. Join the conversation about this story » NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption
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