Tesla, Inc. TSLA shares have been on a tear since the start of May after a period of lull and the upward momentum seen in recent sessions suggests a break above the $300 could happen any time soon.
Stratospheric Rally: Tesla stock is currently on an 11-session winning streak, matching a similar run seen in early January 2021. Since the stock bottomed at $152.37 (intraday) on April 27, the stock has added about 60.4%, and it is up a staggering 98% for the year. The stock closed Friday's session at $244.40, up 4.06%, according to Benzinga Pro data.
Source: Benzinga Pro
Does The Rally Have Further Legs? Tesla bulls are optimistic about further upside from current levels. Future Fund's Gary Black said after 11 straight sessions of gains, Tesla's valuation is still compelling.
After 11 consecutive days of gains ($TSLA +34%, NDX +6%) TSLA now sells at 51x WS 2024 adj eps of $4.80 and 45x my 2024 Adj EPS of $5.40. That’s still quite compelling vs my 5-yr TSLA exp vol and EPS growth of +37% CGR (1.2x PEG, same as $META and $GOOG). pic.twitter.com/NHYI8DhYqm
— Gary Black (@garyblack00) June 11, 2023
The analyst sees further upside stemming from upward revisions to Tesla's earning estimates and more optimistic expectations for the Cybertruck, which is expected to launch in late-2023. He also expects sell-side firms to upwardly revise their price targets for Tesla stock, which has risen past the estimate of most analysts.
"The avg WS TSLA PT of $195 is now 20% below TSLA’s stock price," he said.
The stock’s 52-week high stands at $314.67 (achieved in mid-August 2022), while its all-time high was $414.50 (intraday high on Nov. 4, 2021). Resistance levels can be found around $265 and $303. In the event of profit-taking causing a pullback, the stock could find support around the $208 area.
The rally may not have come as a big surprise for Tesla bulls. Earlier this year, one of them predicted a swift run up to $300.
Musk Is The New Jobs: The Tesla story is just getting started, said Keith Fitz-Gerald, Principal at Fitz-Gerald Group in an interview with CNBC’s “The Exchange,” in February.
“Anybody betting against Elon Musk might as well [have] been betting against Steve Jobs back in the day,” the Wall Street analyst said.
"We know how this is going to play out. He unleashes just incredible transformation in every industry he touches. He is not getting stopped anytime soon, he's got enough money to do what he wants, he's got a clear vision," Fitz-Gerald said.
“I think it [Tesla Stock] goes back to $300 a lot quicker than people think.”
See also: Everything You Need To Know About Tesla Stock
When asked why not take profits now or when the stock touches $250 or $280, Fitz-Gerald said it depends on a person’s risk tolerance and profit objectives.
“I’m a big fan of when you have a double, you take half off and let the remaining shares run for free. Now you paid for your initial investment, you are still in the game, and you can continue to add more later if you want,” he said.
Why It’s Important: The same sentiment concerning Musk and Jobs was expressed by Apple co-founder Steve Wozniak in a separate CNBC interview earlier this year.
“I put them in the category of having the ability to communicate and wanting to be seen as the important person and be like a cult leader,” said Wozniak, comparing the two tech titans.
Some elements of this story were previously reported by Benzinga and it has been updated.
Photo: Shutterstock
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