After WedBush analyst Dan Ives raised his price target on Tesla’s stock to $1,900 last Monday, demand in China hasn’t stopped rising. Now, only a week later, Ives has come with a new note on Tesla regarding improved demand in China.
The analyst stated “ We believe the production and demand trajectory in China for Tesla remains robust and stronger than expected for 3Q with clear momentum heading into year-end. The pent-up demand in the China EV market for Model 3’s and recent price cuts are creating a ‘perfect storm of demand’ for Musk & Co. in this key market with increased market share vs. domestic competitors as the Giga 3 success story continues to play out.”
According to Ives, he predicts in the next 5 years the Chinese market will add significant profitability for Tesla saying “With the China growth story, Tesla could now have $35+ of earnings power by 2025/2026 vs. our prior estimate of $20-$25.”
Even with these new predictions the analyst did not increase his price target of $1,900 per share. He did however increase his “bull case” price to $3,500 helping Tesla’s stock rise up to 4% this morning in pre-market trading.
Tesla shares are currently trading at an all time high of over $2,100 per share with an overall market capitalization close to $400 billion.