Tesla Inc TSLA is on its way to becoming a $2 trillion company, Wedbush analyst Daniel Ives said on Tuesday.
What Happened: Ives told Oliver Renick of TD Ameritrade Network in an interview that the Elon Musk-led company was not an auto company but rather a disruptive technology company.
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“In a year or two from now, we’re not just looking at one trillion for Tesla, but in a couple of years this could be a company that could start to approach 1.5 trillion - 2 trillion [market valuation].”
Ives said that between Tesla and Nio Inc NIO, the former had the lead in the growing Chinese market.
“It speaks to what [Elon Musk] has been able to accomplish — being the only U.S. manufacturer without a partner in China.”
“It’s a big enough ocean for more than one boat,” the analyst said — referencing the size of China’s EV market which can accommodate firms like Xpeng Inc XPEV, Nio, and others.
Ives termed Tesla’s Gigafactory 3 factor as “the key to success” and a “lynchpin.”
Why It Matters: The Wedbush analyst said that Tesla’s profitability is underestimated as it could sell up to 800,000 units this year.
The analyst also pointed to the incoming U.S. administration of Joe Biden as a “part of the optimism,” due to its “green agenda” and a complimentary “blue Senate.”
The political developments in the U.S. are “bullish for EVs” and bullish for Tesla, General Motors Company GM, Fisker Inc FSR, and others, as per Ives.
The analyst repeated his $1,000 bull case price target for Tesla in the interview.
Price Action: Tesla shares closed nearly 4.7% higher at $849.44 on Tuesday and gained 0.3% in the after-hours session.
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