December 3, 2021

Green Industry

Tesla (TSLA) is in a position to grab $2.5 trillion of EV market, says top analyst


Dan Ives from Wedbush, one of the top 10 ranked stock analysts in the world, has increased his price target on Tesla’s stock (TSLA) as he believes the automaker will take a significant part of the growing EV market.

In a new note to clients today, Wedbush announced that it is increasing its price target on Tesla from $1,100 per share to $1,400.

It’s a new market high price target on Wall Street for Tesla.

Dan Ives, the analyst covering Tesla for Wedbush, commented on the price target increase:

“We believe there is $5 trillion of EV auto market dollars up for grabs with Tesla likely to own $2.5 trillion of this pie. We estimate China is worth $400 per share to the Tesla story for 2022 and raising our price target from $1,100 to $1,400 with our bull case $1,800.”

Interestingly, that analysis is still based on a relatively conservative EV penetration rate of 10% in 2025 and 30% in 2030.

In the short term, Ives is betting on China being critical to Tesla’s growth with “40% of the automaker’s deliveries in 2022.”

He also estimates that the current supply chain issues are affecting Tesla’s production of Model 3 and Model Y vehicles by about 15%:

“The chip/component shortage remains a headwind for Tesla (and every other automaker), however we view this as a transitory issue with our core focus on Model 3/Y demand, which is outstripping supply by roughly 15% as of today.”

Interestingly, the analyst also commented on Elon Musk’s recent sale of Tesla shares.

Ives believes that Musk’s approach to go through Twitter and frame the sale as coming from public pressure to pay taxes has saved Tesla’s stock from an estimated 15% slide:

“If he hadn’t conducted a survey on Twitter and just started selling shares, their value would probably be 15% lower than today.”

Dan Ives is ranked #8 out of 7,730 analysts on TipRanks with an average success rate of 82% and an average return of 41%.

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