Jim Cramer of Mad Money Jim Cramer is arguably the…
Tesla Stock Price Predictions
Tesla is one of the most innovative companies of the last 10 years. To many, including its avid fans/customers, it is an inspiring presence in their lives.
Tesla electric vehicles can’t be produced in sufficient volume to satisfy demand in the “global warming” era. The company seems to grow more organically and experimentally than other companies, taking on debt and producing cars in an erratic fashion.
For instance the latest cyberpunk truck may be produced in strange funky design only to fail in sales. Then Tesla will likely rework it so it’s more traditional in function.
While many of the big auto manufacturers could have designed and manufactured an all electric car, they dragged their heels on it. Not Tesla and Elon Musk. They’ve put together a car that delivers excellent mileage per dollar. Most non electric car producers can’t believe an electric car is cheaper to operate but it is.
With each new model Tesla produces, the improvement in performance is astounding. The new Model Y is highly anticipated with its advanced navigation guidance. The Cybertruck is big news too boosting interest in the company. Yet detractors of Tesla and Elon Musk complain about Tesla’s ability to meet production goals.
Perhaps the complaining has paid off and motivated Tesla to up their production and hit revenue goals. In the 3rd quarter the company produced 96,155 cars and delivered 97,000 cars. Wall Street’s demands were for 75,000 to 100,000.
The TSLA stock price jumped in 2017 and then crashed in 2019. There’s a lot of volatility with this company. The Tesla Car Company is now trying to convince investors it is back on track. Compare its stock price performance to company’s such as Google, Facebook and Amazon. Tesla won’t be facing anti-trust and monopoly charges.
Tesla’s stock surged 32% after their recent earnings release.
Why is the financial media so negative on Tesla? The company’s controversial, pot smoking, FCC offending founder Elon Musk says and does unconventional things. That’s not normally acceptable in the corporate investment community.
TSLA Stock Price Forecast
CNN polled 30 analysts ratings on TSLA stock, and here’s their statement:
The 30 analysts offering 12-month price forecasts for Tesla Inc have a median target of 283.50, with a high estimate of 949.00 and a low estimate of 160.00. The median estimate represents a -15.91% decrease from the last price of 337.14.
In the 3rd Quarter the company reported $1.16 per share earnings on sales of 6.8 Billion.
Electric Vehicle Sales and Demand
Sales growth of electric vehicles in the US has been steep. After a hot 2018, growth has slowed, with a forecast of 405,000 units. So when Tesla delivers 175,000 in one quarter this year, that is an astonishing stat for one company. After all, electric cars are a new product. And if gasoline drops in price as it has, it stands to reason the big car makers are going to sell more of their gas guzzlers.
Plug in EVs
Plug in EVs comprise a very small portion of the total market. Regardless of how Tesla performs, they are the premium brand in a market with incredible potential. The upside is something to pay attention to, since the other automakers are more committed to gas powered cars and trucks.
TSLA Price Earnings Ratio
Tesla stock is trading at $335 and 62.8 times analysts’ 2020 EPS forecast. TSLA stock has the highest price earnings ratio in the sector.
Former Tesla employee Steve Westly discusses the company’s performance last summer with Jim Cramer. His positive outlook has borne out.
gov.capital believes Tesla is on the right track for a stock price above $500 near end of 2020.
Guru focus has given warnings on TSLA stock. They flag Tesla’s debt, net revenue and cash flow.
Market Threats to Tesla
What are the threats to Tesla success? Very low priced gasoline will keep constant cost pressure on Tesla. And hydrogen cars are not far off either. Hydrogen is a powerful type of fuel. Musk’s original thought that we’re going to run out of oil and fossil fuels is simply not true. In fact, The US has become the world’s largest producer of oil. If the US were to build more fuel refineries, gas price would plummet making gas powered cars very cost efficient.
Tesla EV cars are are above mid-priced autos and might be harder to sell in a recession. However, Tesla is an unmistakable brand. All the cars are built in Tesla’s California factory which will draw the ire of some states who stand to lose auto jobs. Other companies are building EVs such as Nissan, GM and BMW. It has massive debt which might be hard to finance if interest rates climb.
Tesla positives: It’s a determine, resilient company with a new gigafactory that might produce 500,000 cars per year. The company also produces new age products including solar panels, Solar Roof, the Powerwall home battery, and the Powerpack battery system for commercial and utility-scale sites. Read more about their energy solutions. Read more about the best electric vehicles.
Check out this documentary if you haven’t see it yet. Get to know the company before you buy the TSLA stock.
See more on the best stock picks for 2020, and an updated stock market forecast. Some still believe the market is in a bubble and a stock market crash is inevitable. Political instability is what makes that possible. Otherwise the US economy is looking good investors. The S&P outlook, NASDAQ forecast and DJIA predictions are positive.
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