In 2023, Tesla strengthened its position, showing strong results despite the unstable economic situation. Wedbush analyst Dan Ives expects the company to be worth a trillion dollars in 2024 and boosted his price target on the stock.
Ives believes Tesla’s stock market capitalization will rise from its current value of just over $800 billion to more than a trillion dollars next year. The Wedbush analyst raised his price target on TSLA stock from $310 to $350 while maintaining an “outperform” rating, according to The Globe and Mail.
He expects Tesla to be able to deliver around 2.2-2.3 million vehicles in 2024, representing growth of 25-30%. “For 2024 we believe 25-30-per-cent year-over-year unit growth is very achievable putting units in the 2.2 million to 2.3 million range with upside surprises likely in the cards driven by Model Y sales in China and Europe,” Ives wrote.
The analyst noted that the market for electric vehicles continues to develop, although demand for them has somewhat decreased. He expects that by 2030, their share will be about 20 percent. Tesla continues to be a leader, and by releasing new models to the market, the company will be able to maintain its position.
“While overall EV demand has clearly moderated globally we are still in the early days of this massive transformation with Tesla leading the way as we estimate by 2030 roughly 20 percent of autos will be EV based. Also noteworthy is that as Detroit stalwarts GM and Ford among others appear to be tempering the EV transformation, Tesla is now doubling down with Cybertruck and we expect another sub $30k vehicle to be announced over the next 6 to 9 months.”
Ives noted that the negative storyline for Tesla has dissipated. He sees that the company has begun to raise prices for its cars, and demand for them in China remains strong. The analyst noted that lower vehicle prices at the beginning of the year boosted sales and deliveries for this year should now be in the range of 1.8 million units, as the company had forecast.
“The Category 5 storm that hit Tesla early in 2023 appears to have passed with the company now raising prices and seeing steady demand in (China).
“The Street bear narrative for Tesla heading into 2023 was demand was eroding and competition was increasing across the board. Instead, Musk made a poker move for the ages and cut prices globally with China front and center to catalyze volumes/units which should now impressively be in the 1.8 million range for 2023.”
Ives wrote that the big debate on Wall Street is around price cuts and what Tesla’s path forward will look like in 2024, with profitability a key question among investors. The firm believes profitability has stabilized and should rise from these levels, with Auto GM heading back above the key 20-per-cent threshold during the course of 2024.
“We saw Tesla where Apple was in the 2008/2009 period as Cupertino was just starting to monetize its services and golden ecosystem with the Street not seeing the broader golden vision at the time. We believe FSD and the Supercharger network are worth an incremental $75 per share to the Tesla story over the next 12 to 18 months and the Street will start to factor this dynamic into the stock as Tesla executes on its strategic vision with the next phase of the growth story bound.”