After Bumpy 2018, Analyst Expects Tesla (TSLA) Stock to Take Off in 2019
While its current stock price may not show it, 2018 was actually a good year for Tesla (TSLA). Distractions aside – including CEO Elon Musk’s ouster from his Chairman role after an SEC investigation – the company hit its production goals and reported its strongest-ever quarterly report last quarter, which had led to near-record high share prices. But Tesla is far from a comforting investment choice; the stock has been up or down double digits more than a dozen times this year and is right now in the midst of a two-week 21% fall.
However, Wedbush analyst Daniel Ives remains bullish on the stock, reiterating his Outperform rating and $440 price target, which implies nearly 50% upside for the stock. (To watch Ives’ track record, click here).
Ives opined, “Tesla has turned the corner on Model 3 production out of Fremont/Gigafactory, demand looks very strong into 2019.” Furthermore, the analyst believes, “the roadmap for European Model 3 delivery/shipments appear on schedule for the next few months,” an encouraging sign as the company continues to try to breakthrough in the contentment.
Many analysts have expressed concern with the US government halving its tax credits on electric vehicles in 2019. But Ives believes “that Tesla is poised to deliver a robust 4Q, which will be another major step forward for the company on its path to sustainable profitability and cash flow generation in 2019 on the heels of a transformational Model 3 growth opportunity for the coming years.”
Looking ahead, Ives believes Tesla “has the opportunity to transform consumer auto buying behavior.” The analyst also says, Tesla’s finances are vastly improved, as the company “is now poised to generate improved profitability and cash flow that puts the risk of a capital raise in the background for now.”
If we step back and look at the bigger picture, Wall Street has no clue what to do with Tesla. Its chart shows this, and so does TipRanks analysis. Of the 27 analyst ratings on Tesla compiled by TipRanks, there is a consensus Hold rating with ten analysts recommending Buy, eight recommending Hold and nine recommending Sell. Of the 27 analysts, the average price target is $337.21, or 12% higher than its current value. (See TSLA’s price targets and analyst ratings on TipRanks).