Tesla Inc. TSLA,
could reach its target of 500,000 deliveries for 2020, a goal that has not been on the radar of Wall Street analysts since late spring / early summer, thanks to the strength in China and a late boost in Europe and the USA, Wedbush analyst Dan Ives wrote in a note published Wednesday. “Based on our initial analysis of Tesla’s demand and global delivery trajectory in 4Q, it looks like Musk & Co. is likely to exceed Street and internal expectations,” wrote Ives. The analyst expects fourth quarter deliveries to come close to 190,000 to 200,000 than the 180,000 he called the ‘line in the sand’. “At the end of the year and in 2021, we are seeing a major inflection in EV demand globally with our expectations that EV vehicles will increase from ~ 3% of total car sales today to 10% in 2025,” wrote Ives. “We believe that this demand dynamic will disproportionately benefit the clear leader of the EV category, Tesla, in the coming years, especially in the key region of China, which we believe may represent around 40% of its EV deliveries in 2022, given the pace current accelerated sales. ” Ives is expecting “staggering” demand from China in 2021 and 2022 across the board and said Tesla’s flagship Giga 3 footprint is a major competitive advantage for domestic companies like BYD, Nielsen,
Xpeng XPEV,
and Li Auto Inc. LI,
they are also “firing at all cylinders”. “If China continues on its current path to Tesla, Musk & Co. could reach one million delivery units globally by 2022 (we are currently shaping the 2023 timeline),” he wrote. Additional impetus could come in the form of increased EV credits under President-elect Joe Biden, he said. Wedbush evaluates Tesla as neutral, with a price target of $ 715 for 12 months and an upper case of $ 1,000. Tesla’s shares reversed the initial pre-market losses to gain 1.1% and gained 696% in 2020, while the S&P 500 SPX,
earned 15%.
