Tesla Inc!. Stock is on Fire!.
The Stock is on a seven straight session rally after several good news hits investors.
The stock opens with gaps day after day, giving investors over 50% gain in a very short period of time, amid coronavirus pandemic.
Analyst Dan Levy of Credit Suisse upgraded the stock from underperform to neutral with a price target upgrade from $415 to $580.
According to him, in his note: Tesla now “competitively has more edge in the transition to EV as coronavirus disruption will make it more difficult for legacy automakers to balance the long-term shift to EV in the face of near-term cycle disruption,” Levy wrote. Traditional car companies must make “tough choices in product investment.” Still, Levy questions whether Tesla will be able to ramp up supply and he estimates that the shutdown of the company’s Fremont factory could be driving $300 million a week in cash burn.
Coronavirus-related market gyrations led Tesla shares to drop as much as a 61% from a record high on Feb. 19. The stock has been steadily advancing since the company reported better-than-expected first-quarter deliveries on April 2 and is back to the levels it was trading at in early March.
“There is some clear optimism from the bulls,” Wedbush analyst Dan Ives wrote to clients on Monday. China production and demand appear poised for a significant rebound and should be a key growth driver over the coming quarter, he said. He maintains a Hold rating on Tesla.
Even so, it is now a “virtual impossibility” that Tesla will be able to reach its original annual delivery forecast of at least 500,000 units, according to Ives. Bullish investors are also looking past the shutdown of the company’s vehicle assembly plant in Fremont, California, which could last at least another month, further complicating the delivery trajectory for the coming quarters, he said.
Tesla is set to report Q1 ER before month end. Analysts are divided over weather the electric vehicle maker will report a positive or negative ER.
Over the weekend Bernstein analyst Toni Sacconaghi lowered the price target on Tesla to $500.00 (from $730.00) while maintaining a Market Perform rating.