Tesla’s stock (NASDAQ:TSLA) surged more than 6% Monday, breaking the $500 mark for the first time ever, after Oppenheimer’s Colin Rusch hiked his price target on the stock by nearly 60 percent to $612 per share, the highest on Wall Street for the electric carmaker.
Rusch’s new price target, which is based on a 30x multiple of his 2024 non-GAAP eps estimate of $28.67, discounted 3/yrs at 12 percent, beats out Piper Sandler’s $553 target and Canaccord Genuity’s $515 target. TSLA closed Friday down by more than three points to $478 and change.
In a note to clients, Rusch stated that while Tesla “has stumbled through growing pains,” the group has reached a “critical scale” that is sufficient to support sustainable free cash flow. The analyst also reiterated his “Outperform” rating on the name, noting that the electric carmaker’s powertrain technology, data architecture, and operating system puts it three years ahead of competitors.
Further, the analyst said that based on the “resolution of manufacturing bottlenecks and demonstration of strong consumer demand…[TSLA] is becoming a must-own stock and could benefit from inclusion in additional indexes.”
Stock price action
Tesla shares have had an impressive run over the past three months, gaining more than 92% through Friday. The latest TSLA spike was also fueled by the company’s opening of its Gigafactory in Shanghai. After launching Model Y SUV production at its $2 billion plant, Tesla CEO Elon Musk predicted that the SUV will be more popular than its other vehicles in the world’s largest car market.
As of writing, TSLA is changing hands at $524.62 on the Nasdaq – up 46 points. The name is up 76% year-over-year through Monday versus the S&P 500’s 26.40% gain.