Tesla stock rises 5% on bullish analyst call

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Tesla stock rises 5% on bullish analyst call

Tesla Inc. stock rose more than 5% on Tuesday on the heels of a bullish call from Macquarie Research, which predicted the stock would jump more than 60% in 12 months’ time.

Tesla

TSLA, +4.52%

 shares traded as high as $265.19, up 5.8%. They look poised to snap a five-day losing streak and are at their best since a 17% advance a week ago. The shares were the best performer on the Nasdaq-100.

NDX, +0.28%

 

Macquarie started coverage of Tesla stock at its equivalent of buy and set its 12-month price target at $430, among the highest tracked by FactSet and representing a 63% upside from Tuesday’s prices.

Wall Street on average has a $304.30 price target on Tesla, according to FactSet, which compiled targets from 31 analysts.

“We view Tesla as a disruptive technology growth company with differentiated products and strong brand presence in the secularly growing and equally disruptive markets of electric vehicles, energy storage, and energy generation,” Macquarie analyst Maynard Um said in the note.

Tesla is “uniquely positioned to emerge as the leader in vehicle ecosystem platforms behind its integrated software strength,” he said.

In the near term, Tesla would have “enough levers to get over” a debt maturity hump, specially if the stock reaches $360 by March 1, he said.

While Chief Executive Elon Musk has said the company does not need to tap capital markets, an equity raise would further strengthen the company’s longer-term outlook and provide a cushion, Um said.

Moreover, Tesla “appears on track for production targets and should be able to achieve profitability in (the second quarter of the year),” he wrote.

Related: ‘Think of us small people’: Tesla fans are begging Elon Musk to stop tweeting

In another piece of positive news for the company, Tesla said late Sunday it had achieved its goal of making the Model 3 sedan the safest car ever built, citing the National Highway Traffic Safety Administration, with the Model S luxury sedan and the Model X SUV placing second and third as vehicles with the lowest probability of injury.

See more: Tesla says its Model 3 has lowest probability of injury of any car tested by NHTSA

The shares have been on a roller-coaster recently, and spent last week, except for Monday, in the red as the market grappled with a tweet from Musk that appeared to mock the Securities and Exchange Commission only days after he and regulators reached an agreement to end SEC fraud charges relating to his “funding secured” tweet.

Tesla shares have lost 16% this year, which contrasts with advances of 8% and 7% for the S&P 500 index

SPX, -0.11%

 and the Dow Jones Industrial Average.

DJIA, -0.16%

 

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