Tesla’s stock (TSLA) rises to new highs as Model 3 gets closer to production

For the third time over the past month, Tesla’s stock is reaching new highs today at over $330 per share – bringing the valuation of the company to over $54 billion.

Tesla’s short-term success is tied to the delivering and ramping up production of the Model 3 on time and as it gets closer to the scheduled start in July, investors seem to be encouraged by what they are seeing.

After reaching all-time highs last month and seeing its valuation surpassed GM’s and Ford’s, the stock took a significant setback after it was downgraded by Morgan Stanley analyst Adam Jonas, who sees almost no Model 3 delivery in 2017.

Despite the fact that he keeps his forecast significantly below the company’s, he kept increasing it over the past few months and now it seems like more investors are getting behind the idea that Tesla could deliver significant numbers of Model 3 vehicles in 2017.

At least, it’s what the stock price is reflecting today (via Yahoo):

Earlier this month, Tesla reiterated that it plans to start Model 3 production in July and it expects to reach 5,000 units per week by the end of the year.

The release candidate program has been encouraging with more and more prototypes being spotted in the wild testing over the past few weeks.

Tesla has also been adding numbers to its Model 3 release candidates. The number 67 appears to be the highest spotted so far, but it’s unclear at this point if the numbers are sequential. During its previous test program ahead of Model X production, Tesla was operating a captive test fleet of “hundreds of vehicles”. It wouldn’t be surprising if Tesla’s Model 3 fleet grows to a similar size as it gets closer to production.

Though industry watchers will be especially looking at the production volume that Tesla can achieve in the short-term and that will depend on bringing up its production line. The company recently took delivery of a massive shipment of robots for the Model 3 production lines.

Do you agree with the market? Will the Model 3 be delivered in volume this year? Let us know what you think in the comment section below.