Goldman Sachs has raised its price target on shares of Tesla ( TSLA ) after ten straight days of gains, the automaker’s stock boosted by stronger-than-expected EV supplies. However, Goldman’s stance remains cautious. Although the investment bank has raised its price target to $248 from $175 previously, this reflects a potential downside of around 5% from current trading levels.
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This post was written by Angel Smith
Video Transcript
Tesla shares are currently flat after five days of gains.
But Goldman Sachs doesn’t expect that momentum to continue as the firm predicts the electric vehicle maker’s stock will drop 5% from Tuesday’s closing price but will raise its price target to $248.
This is from $175 here.
And while we’re thinking about the last couple of weeks that have been Tesla and new, the spin around Tesla really kicked in with the delivery numbers that they gave and ultimately that are coming in better than expected, but one question greater and what leverage.
And we were discussing this with our very own mobility reporter, Pro Subramanian, earlier in the week about exactly what this company might be pulling ahead.
They’ve already talked last quarter about vehicles that won’t come to market yet, which is expected by some analysts, who we were talking to yesterday and Seth Gold, saying it’s just going to be an iteration of the model. Y, but maybe a little smaller.
There are certainly some manufacturing efficiencies that Tesla can claim in this regard.
If it was that type of vehicle, but then the price point, where Tesla has initiated and seen this long price war against itself on several occasions.
But that has also allowed other automakers to enter the fray here, especially internationally, where you’ve had absolutely skyrocketing market share in that very competitive region in China and Asia Pacific more broadly.
And so, what Tesla has to say about maintaining market share and continuing to return to what investors have been waiting for globally will be crucial.
And then what boundaries are able to communicate.
Uh, they’re waiting for the rest of this year as well.
Yes, right when it comes to this call here from Goldman, the new price is targeting about 5.5% depth from where it closed yesterday.
However, they cited the fact that reduced inventory levels are a positive sign here for future prices.
But they also went on to talk about some of those headwinds that lower production in the second quarter, lower cost of financing incentives and tariffs here could potentially be a headwind for Tesla down the line and and if you’re starting there, Brad, just talking about the outperformance that we’ve seen in Tesla stock.
Recently, this is a stock that’s up about 44% really since the beginning of June, and you can see that even on the one-month chart it’s up more than 50%.
So the fact that it has done so is adding more than $250 billion to its market gap in the last 10-session rally alone.
This really points to the fact that it is probably due to a little breathing.
But I think the question is the whole demand around EV is what the pricing power looks like, whether or not they’re able to offset some of those price cuts that they had to institute over the last couple of quarters to drive demand and ultimately, what does this mean for their bottom line.
Looking ahead, the company will report earnings after the market closes on Tuesday, July 23rd.
So we’ll see what else the company has to say