Tesla (TSLA) has received a new $1,200 Wall Street-high price target, its fourth in a month, for going after several multitrillion-dollar markets.
The automaker is more than an automaker.
Tesla (TSLA) stock
Tesla’s stock has been on an incredible surge over the last year – reaching new all-time highs on several occasions over the last few months.
It pushed the automaker’s valuation over $800 billion before pulling back in the last week.
The performance and catalysts pushing that performance are making analysts play catchup and updating their valuation models for the automaker and releasing new price targets.
Last month, we reported on Tesla (TSLA) getting a new Wall Street-high price of $810 per share from Morgan Stanley.
That price target was quickly beaten by Wedbush analyst Dan Ives just a week later with a $950 price target, but it didn’t stand at the highest target for long.
Oppenheimer analyst Colin Rusch quickly redefined what it takes to be a top Tesla bull on Wall Street with a new price target of $1,036 per share.
And now he is not even top bull anymore.
Fourth TSLA Wall Street-high price target
Piper Sandler analyst Alexander Potter joined his peers in reevaluating his position on Tesla’s stock following the surge and decided to more than double his price target to a new Wall Street-high of $1,200.
In a new note to clients today, the analyst recommends not to take profit on TSLA despite a 10x return and instead recommended to look at all the different industries Tesla is targeting:
To defend our new price target of $1,200, we are publishing a 100+ page report entitled “The Definitive Guide to Investing in Tesla.” While it is more exhaustive than anything we have published to date, even our expanded model does not capture all potential revenue streams. Indeed, with Tesla’s target industries still embracing outdated business models, it may be decades before this company runs out of new opportunities to pursue.
The analyst is getting on board with an idea that Tesla investors have been pushing for a while: Tesla is more than a car company.
Potter wrote in the report:
There will always be new levers for growth. Some may scoff at our generous assumptions re: TSLA’s long-term potential, but consider this: our model does not contemplate Tesla’s eventual entry into the HVAC or auto insurance markets, both of which represent hundreds of billions in market-wide revenue. Our forecast of peak vehicle production (9M units/year) is also materially below Tesla’s own ambitions, based on capacity plans outlined at Battery Day. Plus we could be under-modeling Tesla’s solar revenue, as well as “Autobidder” and other opportunities in the Energy segment (these businesses are still nascent).
On top of it, as the analyst acknowledges, his own predictions are actually far below Tesla’s own projections.
In the short term, Potter is also being more conservative than many Tesla bulls.
The analyst predicts 894,000 vehicle deliveries in 2021, which most Tesla bulls would say is in the lower range of the possibilities.
Alexander Potter is one of the top-ranked (ranked #266 out of 7,248 analysts) on TipRanks with a success rate of 54% and an average return of 37%.
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