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Tesla brought the bears back into “hibernation mode” after the epic Q4 2022 earnings report, said Wedbush. The manufacturer's shares are up 33% this week, confirming the firm's thesis.

Tesla dampened the turmoil among Street analysts and retail investors by posting brilliant Q4 2022 results on Wednesday. Tesla reported quarterly earnings of $1.19 per share, which beat the analyst consensus estimate of $1.13 by 5.31%. This is a 40% increase over earnings of $0.85 per share from the same period last year. The company reported quarterly sales of $24.32 billion, beating the analyst consensus estimate of $24.03 billion by 1.20%. This is a 37.24% increase over sales of $17.72 billion in the same period last year.

Reacting to strong quarterly numbers, Wedbush analyst Daniel Ives maintains an Outperform rating on Tesla shares, raising the price target from $175 to $200. He attributed the price increase to improved visibility and demand trajectory, as the company said it aims to deliver 1.8 million vehicles in 2023. Keep in mind, Elon Musk said the manufacturer has the potential to sell 2 million vehicles this year.

“In Tesla's Super Bowl last night, Musk & Co. delivered in epic fashion with demand that is currently 2x production coming out of the gates in 2023 and laying out a 1.8 million delivery bogey for the year,” Ives said in a note. He wrote that this is exactly what the bulls have been craving to hear, and “bears (for now) will go back into hibernation mode,” he added.

The analyst stressed that Tesla has set an achievable delivery target for the year in the 38% range. However, he believes this forecast is conservative given that demand in China (as well as around the world) is recovering significantly after the recent price cuts for Model Y and Model 3. It is the “right strategic poker move” to retain customers and prevent competition, said Ives.

Tesla shares are already up 50% in 2023 and up 33% this week alone. The main gains this week came on Thursday and Friday, two days after the release of Q4 2022 results. The 33% increase this week was the best weekly performance since May 2013 and the second-best performance ever.

© 2023, Eva Fox | Tesmanian. All rights reserved.

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