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Tesla Has 'Apple-Like Consumer Brand' Potential, Wedbush Says In Bullish Initiation

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Tesla Has 'Apple-Like Consumer Brand' Potential, Wedbush Says In Bullish Initiation

After a tumultuous three-month stretch from August through October, Tesla, Inc. (NASDAQ: TSLA) has once again found its stride, trading back near all-time highs. On Friday, one Wall Street analyst said Tesla’s third-quarter momentum should continue in 2019 — and the worst of Tesla’s Model 3 production difficulties are now in the rear-view mirror.

The Analyst

Wedbush analyst Daniel Ives initiated coverage of Tesla with an Outperform rating and $440 price target.

The Thesis

Tesla is one of the most dynamic and innovative companies seen in the past 30 years, joining the ranks of companies like Apple, Inc. (NASDAQ: AAPL) and Amazon.com, Inc. (NASDAQ: AMZN), Ives said in the Thursday initiation note. (See his track record here.) 

Tesla's innovation is clear, but the $1-million question is how to value the stock, the analyst said. 

“From a potential capital raise on the horizon, laser-focused Model 3 production metrics and profitability trajectory, lingering SEC/DOJ overhang stemming from Musk’s 'going private' tweetstorm, to China TAM and the investments needed to get there, are just a few of the main debatable investor topics around Tesla over the next 12 to 18 months."

Investors should expect the bumpy road to continue for Tesla stock in the near-term, Ives said. Yet Tesla is poised to significantly ramp up Model 3 production and free cash flow in 2019, he said. 

In the long-term, Ives said Tesla has the opportunity to grow into a consumer brand similar to the Apple ecosystem.

Price Action

Tesla stock was down 0.79 percent at $373.83 at the time of publication Friday and is up 10.4 percent overall in the past year.

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Photo courtesy of Tesla. 

Latest Ratings for TSLA

DateFirmActionFromTo
Oct 2019DowngradesMarket OutperformMarket Perform
Sep 2019Initiates Coverage OnBuy
Jul 2019ReiteratesUnderweight

View More Analyst Ratings for TSLA
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Posted-In: Daniel Ives WedbushAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

 

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