Wedbush analyst Daniel Ives reiterated an Outperform rating on Tesla’s stock on Monday, raising his price target on the company’s shares to $225 from $200, as detailed by Street Insider (via @Tesla New York).
Ives changed the price target after stating beliefs that Tesla’s EV reacceleration in China is just beginning to hit its stride, adding that he expects it to be a tailwind in the first quarter.
“While China demand was a headwind for Tesla in 4Q with the lockdown and macro uncertainty, we are now seeing a noticeable turnaround for Chinese EV buyers favoring Tesla vs. domestic players (BYD, NIO, Xpeng),” wrote Ives in a memo to clients.
Additionally, Ives pointed to Tesla’s price cuts as encouragement to buy for consumers, meanwhile its margins are more stable than other automakers.
“The price cuts have swayed 3 of every 4 EV buyers in China based on our survey work in China and Tesla’s unmatched ability to scale its production operations in China are meaningful to margin stability which are front and center for the Street,” Ives added.
The news also comes after the White House changed guidelines on the federal EV tax credit, officially making all Model Y variants eligible for the incentive in the U.S.
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