Tesla's China business to boost shares to $1,900: Analyst

Jonathan Garber
·2 min read

Tesla Inc. shares will soar 15% amid growing demand in China and potentially “game-changing” battery developments, according to one Wall Street analyst.

Wedbush analyst Dan Ives thinks shares of the electric-car maker will reach $1,900 apiece over the next 12 months, the fourth-highest target on Wall Street.

“We continue to believe EV demand in China is starting to accelerate in July/August with Tesla competing with a number of domestic and international competitors for market share with Giga 3 remaining the linchpin of success which remains the prize that Musk and Tesla are laser focused on capturing,” Ives wrote.

Tesla will deliver 150,000 vehicles from its Shanghai Gigafactory in 2020, helping the company hit 500,000 deliveries worldwide, according to Ives. The electric-car maker delivered more than 179,000 vehicles in the first half of the year, despite the COVID-19 pandemic shuttering its main plant in Freemont, California, for almost two months.

At its upcoming Battery Day on Sept. 22, Ives expects Tesla could announce “very advanced” battery technology that could last for 1 million miles and be a “major step forward when competing vs. traditional gasoline powered automotive competitors.”

Ives, who has a bull-case target of $2,500, isn’t the only Wall Street analyst to grow more optimistic on Tesla in recent days.

Last week, Morgan Stanley analyst Adam Jonas upgraded the stock to “equal-weight” and raised his price target to $1,360, up from $1,050, due to the potential for its battery business.

“We see the scope for Tesla to be both the manufacturer and consumer as well as a company that endeavors to make rapid product improvements in the entire EV stack that we believe can disrupt the broader EV battery industry with potential to grow the pie itself,” wrote Jonas. He has a bull-case price target of $2,636.

Tesla on Aug. 11 announced a 5-for-1 stock split in order to “make stock ownership more accessible to employees and investors.” The split will be distributed at the close of business on Aug. 28.

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Shares had gained 20% since the stock split was announced and were up 295% this year through Friday.

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