After breaking records for the largest drop in value in a six-week period, Tesla’s (TSLA) shares may still be a good bet for the long-term, according to New Street Research.
Analyst Pierre Ferragu upgraded Tesla from a ‘Hold’ rating to ‘Buy’ on Tuesday, with a price target of $900 (USD), up from the firm’s previous target of $578 (via Sawyer Merritt). Ferragu included a prediction of two years of earnings momentum to come, stating that the demand outlook is high.
In a note, Ferragu said, “Demand outlook is stronger than supply could ever be and competition remains a non-issue in foreseeable future.”
BREAKING: New Street Research analyst Pierre Ferragu upgraded $TSLA to Buy (from Hold) with a price target of $900 (from $578).
“Demand outlook is stronger than supply could ever be and competition remains a non-issue in foreseeable future” pic.twitter.com/BXrehEOEXB
— Sawyer Merritt 📈🚀 (@SawyerMerritt) March 9, 2021
While Ferragu included in his Tesla analysis that risks of delays do exist, the analyst doesn’t think it will prevent the company from achieving 2 million units’ worth of production capacity by the end of 2022, with four times as many deliveries in three years. He also reports that he expects the stock to float in the upper side of a 50-100x earnings range for the foreseeable future, likening the stock to how Amazon traded for about a decade.
In January, Tesla’s shares touched $900, before dropping nearly 34% over the past month and a half.
At the time of writing, Tesla’s shares (TSLA) are trading at $676.50, up 20.16% compared to yesterday’s close.
Zachary Visconti is a writer with a knack for electric vehicles, technology, and climate change. Currently residing in Fort Collins, Colorado, Zach loves his partner, his cat, and a good cup of coffee.