Evercore ISI analyst Chris McNally upgrades Tesla (NASDAQ: TSLA) to an Inline rating from Underperform. He admitted that the firm had been wrong about Tesla for over a year, and raised the target price to $650 from $225.
The more actively the price of Tesla shares continues to rise, and the company continues to prove its reliability, the more messages appear that analysts admit that they are wrong about the company. Following in the footsteps of RBC Capital analyst Joseph Spack, who admitted that he interpreted Tesla shares “completely wrong,” McNally also admitted his mistake.
“Whether we call it valuation confusion or valuation rotation, we have been on the considerably wrong side of Tesla for over a year now,” wrote the analyst. McNally raised his price target for Tesla to $650, although that's still well below the current price of around $860.
The firm believes that retail investors view Tesla as two separate technology companies:
"We believe tech / retail investors see TSLA as 2 separate Tech companies (and both pieces grew in size & scope in '19 / 20): 1) A Tech company that is the market leader in electric vehicles (w / broader investor confidence in both the eventual NEV TAM as well as broader expansion of broad tech valuations since the pandemic) & 2) Optionality/amalgamation of multiple adjacent call options (we ballpark est. at an implied market-driven cumulative $ 250- $ 450Bn or ~ $ 300 + / share for everything from FSD to storage to Battery/powertrain tech)."
Today, Tesla shares jumped to a new intraday high of $884.49. At the time of writing, the stock is trading at $864, and the company's market capitalization is nearly $820 billion.
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