What happened
Shares of Tesla (NASDAQ: TSLA) were sharply up on Monday. As of 10.30am EDT, the stock market was up 5.5%.
The sharp shift in the growth stock is likely to be driven by an analyst’s decision to increase its 12-month share price to $ 1,900.
A Tesla Model 3. Image Source: Tesla.
Well what
Shares of Tesla could rise to $ 1,900 within 12 months, Wedbush analyst Daniel Ives said in a research note on Monday. This view is above its previous 12 month price target of $ 1800.
To support his more Bullish outlook for the stock, Ives said he believes demand for electric cars in China has been accelerating in recent months. Tesla, of course, is well positioned to take part in the market following the launch in late 2019 of a factory in Shanghai, where the company is producing a China-made Model 3 specifically for customers in China. The new Gigafactory is Tesla’s “linchpin of success” in the market, according to Ives.
In addition, recent price cuts could boost demand for Tesla cars in the US and Europe, Ives believes.
Now what
Importantly, Ives claims that Tesla is back on track with its pre-coronavirus pre-delivery delivery period of 500,000 cars, despite major setbacks earlier this year with factory shutdowns due to the pandemic.
That total of 500,000 cars in 2020 would translate into 36% year-on-year growth.
