Tesla received a price target hike from New Street Research to $1,580 as deliveries in Q4 2021 surpassed expectations. The firm predicts the manufacturer will deliver 1.5m vehicles in 2022.
New Street Research has posted a new research note entitled Tesla 4Q21 Deliveries: monster beat, Tesla above 1.2m run-rate. Buy, TP $1,580. In the explanation, it wrote:
- Tesla 4Q21 Deliveries well above consensus and even our expectations: 309k vs. us 282k and consensus 266k.
- Model 3 & Y production up 64k sequentially vs. 25k last quarter: production of Model 3 & Y in Shanghai stepping up.
- Demand high across all geographies, low levels of inventories.
- Perfect storm for 2022: the ramp of Berlin & Texas means Tesla can easily deliver 1.5m units in 2022, up 60% YoY. We also expect continued GM expansion + the introduction of 4680. Our thesis is playing out.
New Street Research expects Tesla to deliver 1.5 million vehicles next year:
- Fremont: deliveries of ~ 114k per quarter limited by paint shop capacity in the near term.
- Shanghai: deliveries for 1H22 assumed in line with exit 2021 capacity of ~185k vehicles per quarter. Slight increases thereafter with new expansion.
- Berlin: Final approval for plant still pending. The firm expects production, ramping at 1 crew/quarter, to start end of 2021, ramping to ~70k per quarter in Q4 2022.
- Texas: major constructions still ongoing. New Street Research assumes production starts in March 2022, ramping at the same pace as Berlin.
Upside vs. consensus: the firm expects total deliveries of 1.5m vs. consensus 1.4m (7% upside), Exiting the year at an annual run-rate of 1.7m.
New Street Research believes Tesla needs to announce 4-5 new factories in the coming years to continue to grow at a 50% annual rate. The firm expects the announcements to be made no later than mid-2023, after which it will take up to 2 years before deliveries begin, and another ~2 years to increase the factory's capacity to >700k run-rate.
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About the Author
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.