Tesla stock could surge 104% to $1,000, according to this analyst

Is he right?

| More on:
rising US stock price represented by US dollars flying in front of stock chart

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Shares of Tesla Inc (NASDAQ: TSLA) have already soared nearly 500% so far in 2020 but will surge to new all-time highs in the coming year.

That's according to Wedbush analyst Daniel Ives. On Monday, Ives raised his price target on Tesla's stock from $500 to $560 but presented a bull case that envisions the stock more than doubling to $1,000. His new base target represents potential gains for investors of roughly 14% over the stock's closing price on Friday of about $490. It's the bull case, however, that is most intriguing.

Ives cited several recent achievements by Tesla, including its inclusion in the S&P 500 Index (SP: .INX) and the company's "sustained path to profitability" as helping continue Tesla's momentum. He views the bull-story growth through the lens of increasing demand for electric vehicles (EVs) worldwide.

"Overall we are seeing a major inflection of EV demand globally with our expectations that EV vehicles ramp from about 3% of total auto sales today to 10% by 2025," Ives wrote in a note to clients.

Will Tesla's stock price hit $1,000?

Tesla started out 2020 saying it expected to deliver 500,000 vehicles, though it was somewhat hamstrung by the pandemic. The company has delivered roughly 318,000 cars so far this year, so reaching its initial target seems unlikely.

With sales of EVs expected to triple over the next few years, and Tesla the clear market leader in the space, it isn't unthinkable that Tesla will be able to reach that 1 million vehicle-delivery goal over the next several years -- if not sooner.

That said, Tesla already has a significant amount of growth baked into its share price. The stock's valuation clocks in at a lofty 19 when a reasonable price-to-sales ratio is typically between 1 and 2. While it's certainly possible that Tesla's stock price could hit $1,000, I don't expect it to happen in the coming 12 months.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Danny Vena owns shares of Tesla. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on International Stock News

Semiconductor chip on top of piles of mini US and China flags.
International Stock News

Tariff negotiations could derail Nvidia's China business. Here's why I'm not worried about It.

New export controls around China could serve as a serious headwind for Nvidia.

Read more »

A head shot of legendary investor Warren Buffett speaking into a microphone at an event.
International Stock News

Warren Buffett-led Berkshire Hathaway has 21% of its $276 billion portfolio in 1 stock that's up 644% in 9 years

Investors need to know what company this is. Perhaps it deserves a closer look for your own portfolio.

Read more »

Two IT professionals walk along a wall of mainframes in a data centre discussing various things
International Stock News

Amazon just sent a massive warning to Nvidia investors

A new AI investment from the cloud computing leader could signal a shift in its strategy.

Read more »

A woman sits at her computer with her chin resting on her hand as she contemplates her next potential investment.
International Stock News

Countdown till Nvidia's earnings report: What to expect?

Nvidia reports Q1 earnings on May 28.

Read more »

A man in a suit face palms at the downturn happening with shares today.
International Stock News

Which Magnificent 7 company was threatened with fresh tariffs over the weekend?

The news was not well received by investors.

Read more »

Man charging an electric vehicle.
International Stock News

Why June will be a make-or-break month for Tesla

Next month's launch will have huge consequences for Tesla's stock.

Read more »

A head shot of legendary investor Warren Buffett speaking into a microphone at an event.
International Stock News

26.4% of Warren Buffett's $258 billion portfolio is invested in 2 leading artificial intelligence stocks

Let's check out these two AI leaders that Buffett loves and consider whether they're still buys today.

Read more »

Hand with AI in capital letters and AI-related digital icons.
International Stock News

Could Nvidia stock help you retire a millionaire?

The reality is Nvidia should see strong sales growth for quite a while.

Read more »