Deutsche Bank is raising its estimate for Tesla (NASDAQ: TSLA) deliveries in Q4 2020 to 185,000 units, which is reflected in an increase in the price target to $705 from $500.
Deutsche Bank analysts raised their estimate of Tesla deliveries in Q4 2020 from 176,000 to 185,000 units, reflecting higher Model 3 deliveries in China and Europe. Achieving this number of deliveries will be another quarterly record for the company. Thus, 504,000 units would be delivered during 2020, which exceeds Tesla's target of 500,000 units.
The firm estimates that 130,000 Model 3, 17,000 Model S + X, and 38,000 Model Y will be delivered. Deutsche Bank tracked delivering information that showed that demand for the Model 3 in China and Europe was better than expected. By region, the company estimates 30,000 Model 3 deliveries in the US, ~ 30,000 in Europe, and 56,000 in China.
Deutsche Bank sees 2021 as a pivotal year for Tesla "with material revenue acceleration, benefitting from ramping up capacity and product lines across the globe." Therefore, the firm raises its 2021 delivery forecast by 25,000 to 800,000 (59% YoY), pushing revenues to $46 billion, in line with the consensus.
The firm's analysts wrote that they believe Tesla's impressive target trajectory in terms of technology, power, and especially cost could help accelerate the world's transition to electric vehicles, and significantly expand Tesla's leadership in electric vehicles over the medium term. Deutsche Bank firmly believes that Tesla's plans to cut battery costs will come true much faster than its current trajectory, which could give the company a great competitive edge.
The firm increases its target price from $500 to $705.
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Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.