The Current State of Tesla’s Stock
Tesla, Inc. TSLA shares have been stagnating since the company released its third-quarter earnings report in mid-October. The stock remained unmoved despite the electric vehicle maker reporting above-consensus deliveries report last week. Yet, an analyst on Friday highlighted a resolute bullish stance on the Elon Musk-led company.
Analyst’s Vision: A Rosy Future for Tesla
Reacceleration In The Cards: Analyst Bill Selesky from Argus expects Tesla’s sales, margins, and earnings per share to likely reaccelerate in 2024. He predicts that the factors causing a slowdown in demand, such as a sluggish EV market, rising interest rates, elevated inflation, and supply-chain disruptions, will show positive trends in 2024. Selesky anticipates a decrease in interest rates, deceleration of inflation, and supply chain improvements.
Tesla’s USP: Tesla’s increasing reliance on artificial intelligence in manufacturing and factory utilization is cited as a significant competitive advantage by Selesky. He remarked, “Additionally, we believe AI is an undervalued component of the future growth at Tesla and expects its value to be recognized soon on Wall Street as FSD (full-self drive, battery cell production, and AI-enabled robots) become a bigger part of the future at Tesla.”
Market Share and Growth Prospects
Poised To Grow: Selesky asserts that Tesla is a dominant force in the EV industry, accounting for approximately 50% of the U.S. EV market and 20% of global shipments. He expressed optimism, stating, ‘We believe TSLA has an opportunity to grow market share in 2024.” Gene Munster from Deepwater Asset Management also expects Tesla to maintain its U.S. market share.
Selesky noted that recent entrants to the EV market and brand new entrants have been grappling to balance their future capex budgets, which may work in Tesla’s favor.
Argus has a “Buy” rating and a $316 12-month price target for the Tesla stock, suggesting a 33% upside potential.
Tesla ended Friday’s session down 0.18% at $237.49, according to Benzinga Pro data.
Conclusion
Despite the recent lackluster performance, analysts maintain an optimistic outlook on the future growth of Tesla. Selesky’s forecast of a potential 33% rally in the stock in 2024 is underpinned by the company’s competitive advantages and the anticipated favorable macroeconomic conditions. Should these prophecies come to fruition, Tesla’s stunted stock may soon be revivified to exhilarate shareholders once more.