Will Tesla reach 1000?
|Current Market Cap||$793.7 B||Steady|
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Tesla Stock Performance in the Last 12 Months
- Last 1 Month: +20.2%
- Last 6 Months: +49.6%
- Year to Date (2023): +124.9%
Tesla Stock- Buy or Sell
Net Buy Rating = Buy% – Sell%
- July 1st: +47.5%
- August 1st: +61.2%
- August 31st: +59.2
- September 1st: +60%
- September 14th: +56.1%
- September 20th: +52.7%
Latest Tesla News
- Republican lawmaker Jason Smith, the chairman of the House Ways and Means Committee, has sent a letter to Tesla CEO Elon Musk seeking details of Tesla’s relationship with Chinese battery company CATL. Smith is concerned that U.S. electric vehicle subsidies are improperly flowing to foreign entities. CATL is a Chinese battery manufacturer and Tesla is its biggest customer.
- The Justice Department is investigating Elon Musk’s perks at Tesla going back years. The investigation is reportedly focused on whether Musk received excessive compensation and benefits, and whether Tesla’s board of directors properly oversaw his compensation. The investigation is still ongoing, and it is unclear when it will be completed.
- Saudi Arabia is in early talks with Tesla about setting up a manufacturing facility in the kingdom, according to a report by the Wall Street Journal. The talks are at a very early stage. If successful it would be a major coup for Saudi Arabia, which is trying to diversify its economy away from oil and become a leader in the renewable energy sector.
- Turkish President Recep Tayyip Erdogan asked Tesla CEO Elon Musk to build a Tesla factory in Turkey
Will Tesla Reach $1000? Factors to Consider
- There is a robust demand for electric vehicles (EVs) in the market, and Tesla is well-positioned to capitalize on this growth. In 2022, Tesla successfully delivered over 1.5 million vehicles, and the company is projected to achieve a delivery volume exceeding 2 million vehicles in 2023.
- Tesla maintains a leading edge in EV technology, investing heavily in research and development. Their vehicles are renowned for their extended range, rapid charging capabilities, and advanced driver-assistance features.
- The Tesla brand carries significant strength in the EV industry, enjoying a reputation as a pioneering leader. Consumers highly favor Tesla vehicles, contributing to a loyal and devoted customer base.
- The business has become profitable, resulting in substantial cash flow for Tesla. This financial strength empowers the company to invest in new products and pursue growth opportunities.
- Competition from other EV manufacturers poses a significant challenge for Tesla. Companies like BYD, NIO, Xpeng, and Li Auto are aggressively investing in research and development to expand their market presence, potentially impacting Tesla’s profit margins and overall profitability.
- Tesla’s current valuation is considerable, leading to volatile stock performance. This level of volatility might not be suitable for certain investors, making Tesla a riskier investment option.
- Tesla has experienced production hurdles in the past, and there is a possibility that these challenges may persist in the future. Such obstacles could adversely affect Tesla’s ability to meet delivery targets and impact its profitability.
Is Tesla Stock a Good Investment?
Investors seeking exposure to the electric vehicle (EV) market growth may find Tesla stock to be a favorable investment. With a robust lead in EV technology, Tesla consistently directs substantial investments toward research and development. Before we understand whether Tesla is a good investment or not, here is how Tesla performed in the last quarter of 2023:
In the second quarter, total revenue experienced a significant year-over-year growth of 47%, reaching $24.9 billion. The earnings per share of Tesla for the Q2 of 2023 was 0.78 USD which is a 20% YoY growth.
Operating income, however, saw a slight YoY decrease, amounting to $2.4 billion, leading to a 9.6% operating margin.
The financial landscape was further enhanced as cash, cash equivalents, and investments witnessed a sequential increase of $0.7 billion, reaching $23.1 billion during Q2. This growth was primarily fueled by a substantial free cash flow of $1.0 billion.
The quarter marked a significant milestone with an all-time high in vehicle production and deliveries, achieving remarkable results. The Model Y notably secured its position as the top-selling vehicle worldwide in Q1.
The energy sector also displayed impressive progress, with energy storage deployments surging by an impressive 222% year-over-year in Q2, resulting in a total of 3.7 gigawatt-hours (GWh). This surge was primarily attributed to the ongoing expansion of the first dedicated Megapack factory located in Lathrop, CA.
Overall considering the growth in the EV market and the latest development of Tesla, the company’s stock is a good investment.
Tesla: Strengths and Weaknesses
The all-time high Tesla stock closing price was 409.97 on November 04, 2021. Since then Tesla has not been able to touch $400. However, with the demand for Electric vehicles set to rise in the future, TSLA’s share price is expected to rise higher and could also reach $1000. However, before determining how Tesla stock price could reach $1000, let us look at some favorable factors that could push Tesla above $1000
- EV Demand continues to rise and Tesla remains a dominant player. Cybertruck likely to contribute significantly over the next 5 years
- FSD and other software-related revenues are likely to increase in the share of revenue and are likely to grow even faster than EV sales
- Megapack revenues are likely to become a significant contributor over the next 3-5 years
Let us look at factors that don’t favor Tesla
- Raw Material availability and cost
- Competition may or may not beat Tesla on quality but at some point will bleed Tesla on Margins
- Elon Musk’s own conduct on Twitter though he has been fairly silent over the last few weeks
Our $1000 Forecast is done in Multiple ways
Can Tesla Stock reach $1000? EPS Estimate Method
Tesla Earnings Per Share Forecast 2030
- Motley Fool: $24.3
- Gary Black: $40
Average Earnings Per Share: $32.2
Using the current EPS multiples on future forecasts Tesla will hit $1000 in the year 2027. In reality, it will take longer given that EPS Multiples will fall over time.
Will Tesla reach 1000? Using the last quarter’s growth (YOY)
Tesla’s EPS(non-GAAP) gained around 40% in the 4th quarter of 2022. Taking this growth as a base, Tesla stock will reach $1000 in 2029. In reality, EPS may not rise at the rate of 40% through the next 5-7 years.
Caution: Long Term Forecasts are a good topic to discuss but are quite unreliable due to the vagaries of the economic environment and the limited data available.
Will Tesla reach 1000? Conclusions
Considering the fundamentals and the current forecasts, it is likely that the earliest Tesla stock would reach $1000 is between 2027 and 2029. While EPS may not rise at the pace estimated, Multiples which are also a function of the economic environment at that point in time could push Tesla to $1000 in the next Bull Cycle.
Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in the Stocks or Crypto Coins. Please consult a registered investment advisor to guide you on your financial decisions.