Tesla Upgraded to Outperform at Credit Suisse with $1,025 PT

Tesla (NASDAQ: TSLA) has been upgraded to outperform from neutral at Credit Suisse with a price target of $1,025. The firm said stock pullback creates an "attractive" entry point amid "highly favorable" fundamentals.

Credit Suisse upgraded Tesla to outperform from neutral, noting that with the recent market decline creates an "attractive" entry point for the stock. In the report, analysts Dan Levy and Trevor Young wrote that they believe the stock should bounce back given "highly favorable" fundamentals. The firm expects further volume growth, sustained strong margins, and a positive revision in earnings per share in the coming years.

"With robust fundamentals ahead and with the stock having been caught in the market decline, we believe the stock should recover."

"Tesla remains the leader of the multidecade secular transition to electric vehicles," said the report. "With less question around demand and much more question around supply of electric vehicles, Tesla should be a key beneficiary. It has a product lead vs. others and has taken the most holistic approach on electric vehicle supply," the analysts continue.

"Where we could be wrong:...Tesla's underperformance year to date, down 20% versus down 7% for the S&P 500, can be explained by a market that has punished growth.

"Year-to-date, value stocks have relatively outperformed by 12%, while growth stocks, for example, Tesla, have underperformed by 7%. As any positive outlook on Tesla must use a long-term valuation, a risk to our call is that rising rates pressure secular growers."

© 2022, Eva Fox | Tesmanian. All rights reserved.

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This article is for informational purposes only. You should not construe any such information or other material as an investment, financial, or other advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, or offer by Eva Fox, Tesmanian, or any third party service provider to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction.

Eva Fox holds zero shares of Tesla, Inc., and currently (at the time of this article's publishing) holds zero options or securities in Tesla Inc. and/or its affiliates.