Tesla TSLA has a clear path to $1,400 with its recent regulatory win, Wedbush believes, building on Giga Berlin's production approval last week.
Late last week, Tesla received regulatory approval to begin the production of electric vehicles at its Giga Berlin. While TSLA stock is still volatile, this update, which is due to an increase in overall production, brings even more good news with it. Wedbush analyst Dan Ives, who has repeatedly proved correct in his predictions about the Texas producer's share price, published a note in which he expressed his view on the current situation.
Ives remains bullish on TSLA stock despite the temporary price cut. In a note to investors, he acknowledged that Wall Street was on edge as it watched the company struggle to get a building and production permit for Giga Berlin.
“We cannot stress the production importance of Giga Berlin to the overall success of Tesla’s footprint in Europe and globally,” Ives wrote in the note. The analyst also pointed out that “the current Rubik’s Cube logistics of producing cars in China at Giga Shanghai and delivering to customers throughout Europe was not a sustainable trend.”
Tesla's path to delivering cars to Europe had a number of challenges, but the company coped well with them and was able to win a share of the local automotive market. Now that the last regulatory hurdle has been removed, there is nothing stopping the manufacturer from meeting Europe's need for electric vehicles. This, in turn, will take the load off Giga Shanghai, which will gradually focus on meeting demand in local markets and those close to China.
In the note, Ives also reiterated his price target for TSLA at $1,400. At the moment, this is significantly higher than the current share price, but this decline could ultimately turn out to be a great opportunity to buy on the dip, which will bring investors almost 70% in profit. The rise in share price will not come as a surprise as Tesla conquers a new continent. Even if Ives' price target is not reached within a year, the stock will still generate significant returns for investors throughout this time. Investors should not lose sight of the significance of this regulatory victory for Tesla.
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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.