Tesla’s target price raised again, even as analysts preach caution
Tesla ( TSLA ) stock received another price target increase on Monday, following a series of similar actions by firms last week after the EV giant reported record global deliveries.
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Jefferies analyst Philippe Houchois raised his firm’s TSLA price target to 265, up from 185, on Monday. That’s about 3% below Tesla stock’s Friday close of 274.43.
Last week, many firms, including Goldman Sachs and JPMorgan, raised their price targets after Tesla deliveries jumped to 466,140 in the second quarter, sprinting past Q1’s record 422,875 and Q4’s 405,278. That easily beats estimates of about 445,000, according to FactSet.
Jefferies also maintained a hold rating on TSLA. Houchois said Jefferies agreed with the “consensus view” that Tesla’s second quarter will be a slump in auto gross margins. The analyst added that the latest developments also suggest a shift in valuation drivers with Tesla’s early focus on AI-based autonomy “standing out.”
Tesla shares fell about 1% to 271.59 on Monday during market trading.
On Friday, Morgan Stanley analyst Adam Jonas urged investors to be cautious when looking at the EV space.
“EV names have rallied strongly in 2Q on risk reversal, broadly positive deliverables and other factors, including financing milestones,” Jonas wrote.
“We caution investors that EV market fundamentals (supply/demand) may look like the solar industry, which says high growth and disappointing returns,” he said.
Tesla battery workers laid off
While Tesla topped analysts’ Q2 delivery views early last week, Bloomberg reported on Friday that the company may lay off some battery production workers at its Shanghai plant. It is unclear how many workers may be let go, or the specific reasons behind the layoffs, according to Bloomberg.
Meanwhile, officials in Mexico said all permits for Tesla’s new facility in the country are well under way, according to local reports. Officials told the press that there is no set date for when construction will begin, but that groundbreaking could begin “at any time.”
Tesla executives confirmed plans to build a factory in Mexico in March. The company’s long-awaited next-generation vehicle will be built at Giga Mexico, according to Tesla.
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Tesla shares
TSLA shares are up 122% in 2023 and 169% from their January 6 low. However, Tesla stock remains well off its all-time high of 414.50, reached in November 2021.
On June 2, Tesla cleared a buy point of 207.79 from what is either a cup or a double bottom base. It was part of a record 13-session winning streak for Tesla, with the last 12 being above average. Shares stalled in late June amid the broader decline in the market, but bounced from near the 21-day lines.
TSLA jumped 6.9% to 279.82 on July 3 after strong Q2 delivery numbers, paring a brief hiatus to hit a nine-month high.
Tesla reports accounts for the second quarter on July 19.
Follow Kit Norton on Twitter @KitNorton for more coverage.
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