CFRA upgraded Tesla shares from Hold to Buy and increased its price target from $875 to $1,250, based on a '24 P/E of 95.4x, justified by TSLA's earnings growth potential and strong execution.
CFRA analyst Garrett Nelson raised the price target for Tesla from $875 to $1,250. He indicated that he raised the 12-month target based on a '24 P/E of 95.4x, justified by TSLA's earnings growth potential and strong execution.
"We hike our 12-month target by $375 to $1,250, based on a '24 P/E of 95.4x justified by TSLA's earnings growth potential and strong execution. We raise our adjusted EPS estimates by $0.65 to $6.50 for '21, by $1.45 to $9.05 for '22, by $2.15 to $11.25 for '23, and introduce '24 at $13.10."
The catalyst for the price update was also because Tesla's Q4 2021 delivery data of 308,600 units, well above the consensus of 265,700. This also reflects a 71% increase over 2020.
In addition, the rating was raised as the manufacturer finished construction of its factories in Austin and Berlin, which will serve as a support for production growth in 2022 and beyond.
"After a year in which TSLA shares rose 50% ... we raise our opinion to Buy as the completion of new factories in Texas and Germany sets the stage for further growth in 2022 and beyond."
CFRA also believes that Model S Plaid sales will help drive the average realized price increase, and that the first deliveries of Cybertruck and Semi may come sooner than many expect.
The firm thinks that a near-term overhang in the form of tax-related stock sales by Tesla CEO Elon Musk has been lifted and a 13% pullback over the last two months provides a compelling entry point.
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