Tesla Gets A Street High $1,200 Price Target: 'The Fireworks Aren't Over Yet'

Tesla Inc TSLA got a massive price target boost from Piper Sandler, with the firm dissuading investors from selling the stock.

The Tesla Analyst: Alexander Potter has an Overweight rating on Tesla shares and he upped the price target from $515 to a Street-high $1,200.

The Tesla Thesis: Tesla is now a component of the S&P 500 Index and many of issues that plagued the company have been now addressed, Potter said in a note.vThe stock cannot be overlooked now and any downside catalyst materializing will be met with eager buying, the analyst said.

See also: How to Invest in Tesla Stock

Piper Sandler now forecasts deliveries of 894,000 vehicles in 2021, with sales eventually ramping up to over 9 million vehicles in 2030.

Related Link: Tesla Reports Record Quarterly Revenue Of $10.74B, Semi Deliveries Will Begin This Year

More importantly, there is likely to be a steady ramp in full self-driving software adoption starting in 2030. This, the analyst said, should have a big impact on margins, with EBIT margin eventually exceeding 40%.

Tesla Energy will likely increase from about 6% of revenue currently to about 20%-30% by 2030s, Potter estimates.

Tesla is targeting multi-trillion-dollar markets and there will always be new levers for growth, the analyst said. The company could eventually enter into the HVAC or auto insurance markets, both of which represent hundreds of billions in market-wide revenue, he added.

"2020 was a breakout year for TSLA, but in our view, the fireworks aren't over," Potter said.

Even after a 10-times return over the past 12 months, investors shouldn't be selling this stock, the analyst said.

TSLA Price Action: At last check, Tesla shares were advancing 4.1% to $826.45.