Summary
- Tesla reported strong earnings per share and automotive margins
- Shares of Tesla have increased by over 25% in the past five trading days
- Price target upgrades from analysts are based on strong Q3 performance and upcoming plans for more affordable models
- Price targets from analysts range from $225 to $298, with positive outlooks on profits and margins
- Analysts believe Tesla will continue to see growth opportunities in vehicle programs, autonomy, AI, and energy storage.
Article
After Tesla reported its key earnings call for 2024, analysts have been upgrading their price targets for the stock. Despite slightly missing revenue, Tesla reported a massive earnings per share beat and saw its automotive margins reach 17.05 percent, exceeding analyst and investor expectations. This strong showing led to a spike in Tesla’s stock price of over 20% in the past five trading days.
One of the firms that raised its price target for Tesla is Daiwa Securities, which increased its target from $225 to $285 while maintaining a neutral rating on the stock. Daiwa attributed the price target boost to Tesla’s strong Q3 results and performance in both automotive and energy operations. The firm also highlighted the profitability of the Cybertruck, energy storage in China, and the ramp-up of the 4680 battery program as factors that could further improve margins for Tesla.
CFRA analyst Garett Nelson also raised his price target for Tesla to $225 from $220, noting that while expectations were low heading into the earnings release, the beat indicated a strong performance by Tesla in Q3. However, Nelson warned investors to be cautious about the sustainability of Tesla’s Q3 gross margin, as it may not be as stable as anticipated.
Canaccord Genuity analyst George Gianarikas maintained a ‘Buy’ rating on Tesla shares and raised the price target from $278 to $298. He cited strong profits, good margins, and a positive non-GAAP EPS trajectory as reasons for the price target increase. Gianarikas also highlighted that Tesla’s vehicle programs, autonomy, AI, and energy storage initiatives are all indicators of potential growth opportunities for the company.
As of the time of publishing, Tesla shares were trading at $270.61. Analysts and investors are optimistic about Tesla’s future with the momentum the company is carrying into 2025 and the plan to launch more affordable models in the first half of the year. The strong Q3 performance and margin improvements have boosted confidence in Tesla’s ability to continue its growth trajectory and capitalize on emerging technologies in the automotive and energy sectors.
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