Tesla TSLA Gets PT Boost $980 from First Shanghai as Model Y Enters Year of Skyrocketing Deliveries

Tesla TSLA Gets PT Boost $980 from First Shanghai as Model Y Enters Year of Skyrocketing Deliveries

Photo: Tesla China

Chinese firm First Shanghai Securities Limited has upgraded Tesla (NASDAQ: TLSA) stock to Buy from Hold and raised their price target to $980 from $380. The firm wrote that the company's peak vehicle production capacity is over one million, and Model Y is entering a year of skyrocketing deliveries.

First Shanghai wrote in its report that Q4 2020 revenues exceeded market expectations and amounted to $10.744 billion, up 46% over the same period last year. Q4 GAAP net income was $270 million, reaching six consecutive quarters of profit. The company's total gross profit in Q4 decreased due to several factors:

1) commissioning of the production line, including S/X restyling; conversion to single-piece rear casting Model Y and 3;

2) the instability of the supply chain, which is affected by the epidemic;
3) increase in the value of shares and related payments to Tesla CEO.

However, some of these factors paved the way for higher gross margins, says First Shanghai.

  • the Fremont Model S and X production lines were suspended in Q4 for refurbishment. But the new Model S will arrive in Q1, while the Model X will arrive later;
  • machines for the single-piece rear casting for model Model Y has also been debugged;
  • deliveries of the Model Y from the Shanghai factory began in the second half of January, and orders placed now will not be completed until June;
  • construction of the Berlin plant is progressing as planned, and Model Y production will begin in the second half of the year;
  • the plant in Texas is expected to begin production of the Model Y and a small number of Cybertrucks in the second half of the year.

The firm is also making a revaluation based on Tesla's annual delivery of 20 million units in 2030, and a battery production capacity of 3 TWh. Given Tesla's Q4 and 2020 results and the company's 2021 outlook, First Shanghai is raising its price target to $980, and updating its rating to Buy from Hold.

H/T @SawyerMerritt/Twitter

© 2021, Eva Fox. All rights reserved.


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About the Author

Eva Fox

Eva Fox

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.

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