Tesla : shares extend rally driven by broker comments

Cercle Finance•02/02/2021 à 17:11

(CercleFinance.com) - Tesla shares rallied for a second straight session on Tuesday, the day after a broker issued a particularly upbeat target price for the share.

The stock was up about 3% in morning trading on Tuesday, at about 867 dollars, after surging 5.8% on Monday.

In a research note yesterday, analysts at Piper Sandler set a new, ambitious 1,200-dollar price target for the stock, up from their previous target of 515 dollars.

In a 100+ page report entitled 'The Definitive Guide to Investing in Tesla,' the broker said it may take 'decades' before the electric carmaker runs out of new opportunities to pursue.

'Tesla is targeting multi-trillion dollar markets,' Piper Sandler said, adding that 'there will always be new levers for growth.'

The broker pointed out, however, that its model does not include Tesla's eventual entry into heating, ventilation and air-conditioning (HVAC), or auto insurance markets, both of which represent hundreds of billions dollars in revenue.

Piper Sandler also pointed out that its forecast of peak vehicle production, at 9 million units per year, is also materially below Tesla's own ambitions.

Piper Sandler has an 'overweight' rating on the shares.