Tesla investors endured a pretty rough couple of weeks but are headed back to the top as the automaker’s stock (TSLA) is surging again thanks to record performance in China as well as a new price target from Wall Street analyst.
As it is widely known, Tesla managed to have a very profitable 2020 as the hardships brought on by the coronavirus pandemic wreaked havoc on industries worldwide. During the first weeks of 2021, it seems as though Tesla’s luck success was rolling over into the new year. However, over the last couple weeks, TSLA stock has been plummeting during what appears to be a broader market correction.
During this crash, Tesla market capitalization dropped over $100 billion. However, the automaker’s stock is experiencing a massive surge today of upto 12%, causing Tesla’s valuation to once again rise.
According to some publications, the surge can be attributed to new Tesla performance numbers that were released last month by the China Passenger Car Association.
According to the association, the EV giant produced 23,600 vehicles and delivered 18,300 in China in February 2021. Impressive numbers to crank out during this time as the Lunar New Year restricted Tesla’s production in the country to about 3 weeks.
With the start of production the Model Y at Gigafactory Shanghai expected to increase Tesla’s performance in China, Wedbush analyst Dan Ives wrote in a note to clients: “We believe price cuts and the Model Y introduction were key to some of these changing market dynamics in China. That said, overall EV demand in the region looks robust with EV penetration set to go from 4.5% in China for 2020 to 10% by 2022 in this EV arms race with Tesla and its Giga footprint front and center.”
The top Wedbush analyst recently changed his one-year price target on Tesla’s stock to $950. Ives even went as far as to say that he believes Tesla could reach a $1.5 to $2 trillion market cap within the next 2 years.
Ives isn’t the only one betting on the EV giant as New Street Research also upped its price target today to $900. The premiere independent research boutique said in a note to clients: “With Berlin and Texas ramping, Tesla should reach 2m unit capacity, even is a lot of clouds sit on tight current timelines: building permits in Berlin, a delayed Model S&X refresh, Model Y ramp-up in Shanghai, and the Cybertruck still being in the design phase. We don’t see any of these risks pushing the 2m mark beyond the end of 2022. This means Tesla should deliver over 2m units in 2023.”