Tesla Inc (TSLA) Is Poised to Be King of Electric Vehicles; Analyst Romit Shah Predicts “Unprecedented” Revenue Gains

Nomura's Romit Shah likens Tesla's electric cars to Apple's global sensation smartphones.


Tesla Inc (NASDAQ:TSLA) is looking at killer longevity down the line, if Nomura analyst Romit Shah is right that the electric car giant is steamrolling right along in tech titan Apple’s footsteps.

For a tech empire like CEO Elon Musk’s, the company sells more than just cars to the public, but inspires “real passion” with a legacy that could follow that of the Apple iPhone evolution.

Keep in mind, “Apple succeeded because the world shifted from PCs to smartphones and Apple had the best product,” explains the analyst, who sees a connection to be made to Tesla’s asset that he champions above the rest of its rivals: “Similarly, we believe there is a secular shift today from internal combustion engines to electric vehicles and we think Tesla has the best product.”

What kind of gains could this spell out for Tesla? Shah wagers, “We believe a strong affinity for the Tesla brand will translate into unprecedented revenue growth and strong cash flows.”

After test driving the mass-market Model 3, Shah has walked away all the more confident on Tesla’s shiny future: “We aren’t professional car reviewers, but we walked away believing that Tesla will be selling as many cars as it can produce for a long time.”

After testing out the wheels on the Model 3 for a ride, Shah expresses excitement in the kind of target market prospect that could be even bigger than competitors BM3, Mercedes, and Audi. To put it simply, to take the Model 3 for a spin was “exhilarating” for Shah.

“Importantly, the technology integration is a clear advantage. Model 3’s immersive central display experience is as close as we’ve seen to smartphone/automobile integration. We view this as a critical point; we think that legacy automakers have very much underperformed on keeping pace with the onboard utility of a smartphone, through a period in which the smartphone has become a critical part of day-to-day life,” concludes the analyst, enticed by the revenue opportunity waiting in the wings.

As such, the analyst maintains a Buy rating on TSLA stock with a price target of $500, which represents a 65% increase from where the stock is currently trading. (To watch Shah’s track record, click here)

Musk’s brainchild has analysts fiercely undecided between the bulls and the bears, considering TipRanks analytics exhibit TSLA as a Hold. Out of 20 analysts polled by TipRanks in the last 3 months, 4 are bullish on Tesla stock, 8 remain sidelined, and 8 are bearish on the stock. With a return potential of nearly 3%, the stock’s consensus target price stands at $310.93.

  • Arthur Burnside

    What are these guys drinking? Tesla is about as much a tech company as Gillette –
    they are a nich automaker – virtually all of their money now, and practically every cent they make will come from their auto sales. Listening to a friendly stock analyst pump Tesla after driving around in a rather plain looking Tesla Model 3 sedan (that has no door handles, as one locked out owner found out recently) which I claim has the ugliest front end ever built, along with the ugliest aero wheel covers ever built,
    makes me wonder how they like being a shill for a company whose stock they pump
    every chance they get. Avoided mention that Tesla’s Model X now has the distinction of occupying the 10 most unreliable cars list compiled by Consumer Reports, with the Model S not far behind. And Musk has the audacity to dispute CR’s ratings of the likely average reliability of their Model 3, a car they cannot even produce on their assembly line. Anyone crazy enough to trust Tesla Motors desrves what they get – a very overpriced vehicle, whose most important component (its battery pack) will certainly be obsolete in a matter of months probably. Porsce, an automaker who never made an electric, has already crushed Tesla’s braggings about their fast recharges – their Mission e electric will recharge more than twice as fast as a Tesla.
    Oh, looks like the high tech company ain’t all that high tech.

    • Runar Botnen Totland

      until u drive and expefience a tesla for a few days, you shouldnt be allowed to comment about the cars or company.;-) posts like this will be oh so embarrasing in a few years.

      oh, and you should read up about batteries in general and porsche specific.. and check definition on vaporware

      • Jen Magnus

        Had one of my employees test drive a Model 3 and had one on order. The SALESMAN told him to forget the Model 3 in New England if this is his only vehicle. RWD and can’t handle snow. So this becomes a vanity car for liberals who already have a normal car manufactured by companies that have been building cars for decades, reliably. He canceled his order and bought a Toyota. Besides, the fact is, the initial quality is lacking and TSLA cannot meet production goals which gives everyone, including Porche, more time to perect batteries and technology since they already can build an actual car, unlike TSLA.

        • Runar Botnen Totland

          Pure bulls*t from this salesman, whom should be fired instantly. 🙁

          A Tesla RWD is infinite better than any ICE car, front or rear wheel drive. And almost on par with AWD ICE. Our Model S is beautiful on snow and ice. This is due to Instant traction and low/even weight.

          F*king ignorant salesman..

          (We Live i Norway, Drammen/Konnerud. Snow-heaven/hell in Buskerud county.)

          • Jen Magnus

            Maybe the Model S is, but he was talking Model 3

          • Runar Botnen Totland

            He has no experience with model 3, none of us has.. and why would model 3 be any less excellent on ice/snow than model s and x? Same weight balance and quick ev traction. I call b*llsh*t on this. 🙂 And poor salesmanship, basing advice on own ignorance/prejusdice

          • Jen Magnus

            Well, Musk is just as bad at his financial and production projections as he is a training a salesforce.

  • Jen Magnus

    Wait, are you trying to tell me NONE of the traditional automakers in the world build a nicer car regardless of the propulsion systrem and that NONE of them can make them electric? No, TSLA is headed for bankruptcy. They cannot even weld the body panels properly and the Model 3 base car is rear wheel drive and can’t function in snow (that kills the market for single vehicle owners in the northern half of the country). Musk is a dreamer who has sold a pile of technogarbage to stupid investors. Ultimately, he does NOT have a monopoly on electric engines and batteries and never will and his product is subsidized by the taxpayers (not for long), can’t meet production goals (or even come close) and is getting poor ratings in initial quality. Musk is toast. It’s just a matter of time before the bond ratings agencies downgrade him even further into junk territory where he already is.