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Tesla earnings lay the groundwork for another 38% rise in the stock after the EV maker delivers upbeat guidance, Wedbush says

Elon Musk at the Tesla giga-factory in Berlin.Tesla CEO Elon Musk opens its Berlin factory in March 2022.

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  • Tesla’s Q4 earnings and guidance lay the foundation for the stock to jump back to $200, Wedbush said Thursday. 
  • Wedbush also raised its price target to $200, implying 38% upside for Tesla’s stock from Wednesday’s close. 
  • Tesla’s demand story is “roaring out of the gates” in 2023, analyst Dan Ives said. 

Tesla’s shares could recapture the $200 level that’s been elusive for two months, according to Wedbush, which raised its price target after the electric vehicle maker beat fourth-quarter earnings expectations.  

Analyst Dan Ives in a Thursday note lifted his Tesla price target to $200 from $175. That implies the shares hold the potential to rise 38% from Wednesday’s close at $144.43. Shares haven’t traded above $200 since early November. 

Tesla late Wednesday posted per-share earnings of $1.19, ahead of a Refinitiv consensus forecast of $1.05. CEO Elon Musk said in a call with analysts that its recent price cuts made a “difference” during the quarter. 

“[With] Twitter noise starting to dissipate and the demand story roaring out of the gates in 2023 despite a darker macro, we walk away from this call incrementally more bullish on Tesla into 2023,” said Ives. 

He also said Musk gave a “hittable/ beatable” delivery target for 2023 that could end up being conservative, given a demand rebound in China following recent price cuts on its Model Y and Model 3 vehicles.  

Tesla foresees delivering 1.8 million cars in 2023, up 37% from 1.31 million vehicles in 2022.  

“While in the near-term Tesla is sacrificing margins for higher volumes, we view this as the right strategic poker move to put an iron fence around its customer base and fend off growing EV competition coming from Detroit, Europe, and China,” said Ives. 

Tesla stock jumped 9% to %157.74 as Thursday trade got underway. The stock slid by 64% in 2022, landing among the 10 worst-performing on the S&P 500.

A number of investors and analysts, including Ives, have said Tesla’s stock had come under pressure with Musk’s controversial purchase of Twitter in October.

Read the original article on Business Insider