Morgan Stanley analyst Adam Jonas today raised Tesla’s target price to $1,200 from $650. Before that, Jonas was once bearish on Tesla. But with its potential to become a major battery supplier for electric vehicles, Jonas today nearly doubled Tesla’s target share price to $1,200.
By comparison, Tesla closed at $800.03 on Friday. Jonas’s $1,200 share price means Tesla will have a market capitalisation of $220 billion. Still, Jonas continues to maintain Tesla’s “downsizing” rating.
Jonas said in his report that the “radical assumption” was based on the possibility that Tesla could win a 30 percent share of the global electric car market, including the potential to deliver 4 million vehicles by 2030, plus Tesla’s potential to supply powertrains, including batteries and electric motors, to other automakers.
For reference, Tesla delivered 367,500 electric vehicles to customers in 2019, up 50 percent from 2018.
Tesla’s share price has seen a crazy rise this year. So far, the stock has risen 91 per cent, thanks mainly to good results, short squeezes and the start-up of factories in China. Last week, Tesla also announced that it would issue common stock at $767 a share to raise $2 billion.
The average target price given to Tesla by Wall Street analysts is $489.47, well below the current actual price of about $800, according to the data. It should be noted that the $1,200 target price is Morgan Stanley’s most optimistic forecast, with a base estimate of $500 and the most pessimistic forecast of $220.