logologologologo
  • Home
  • Business
  • Markets
  • Exchange
  • Investment
  • Personal Finance

Tesla stock is big buy, Goldman Sachs says

Tesla’s stock has been on an electrifying run this summer, and it may not yet be over.

Shares of the EV maker are up 12% in the last three months, handily outperforming the S&P 500’s nearly 5% decrease over that time.

Wall Street credits the push higher in Tesla shares to optimism around new government legislation that will support the adoption of EVs in 2023 and beyond. Tesla’s strong execution in the first two quarters of the year has also won over the bears.

Despite the stock’s rise, Goldman Sachs analyst Mark Delaney believes there is more upside to Tesla. Delaney’s hot take comes after a meeting with Tesla’s head of investor relations Martin Viecha.

Here’s what Delaney had to say on Tesla following that pow-wow.

  • Price Target: $333.33
  • Rating: Buy (reiterated)
  • Stock price movement assumed: +22%

Takeaway #1: Tesla’s costs are headed lower

“Tesla’s automotive cost of goods sold per vehicle fell to about $36,000 in 2021 from over $70,000 in 2017. While this metric increased in the second quarter driven by factory shutdowns, factory start-up costs, and input cost pressure, cost of goods sold per car can trend lower over time as Tesla benefits from the ramp of the Berlin and Austin factories (and the reduced percentage of vehicles coming from Fremont, which is a converted ICE factory with higher costs than Tesla’s purpose-built EV factories), scale, and vehicle platform and battery improvements.”

Takeaway #2: Tesla is a winner from the Inflation Reduction Act (IRA)

“It’s too soon to say what impact the Inflation Reduction Act will have for Tesla, and a lot will depend on guidance from the government about how the law will be interpreted. However, we note that the IRA does seek to encourage a North America based EV supply chain and Tesla has more local manufacturing than average (with Model 3 and Y recognized as the most American-made vehicles per media sources), and we believe this will be a positive for Tesla to potentially qualify for at least partial credits on some vehicles over time (and Tesla could potentially benefit as well in our view from incentives for solar, batteries, charging, and commercial vehicles).”

Takeaway #3: Tight EV supply supports higher prices, profits

“Tesla believes that consumers will increasingly move toward EVs, similar to other technology inflections (e.g. CRT to LCD TVs, and feature phones to smartphones), but the EV industry could be supply constrained over the intermediate term as new battery/component supply and assembly takes time to ramp up.”

Goldman’s investment thesis on Tesla

“We believe that Tesla, given its leadership position in EVs (including its vertical integration and tight coupling of hardware and software, as well as its ecosystem of charging stations and brand), and its focus on clean transportation more broadly (given its solar and storage businesses) is well positioned to capitalize on the long-term shift to EVs. We expect Tesla to expand margins in the intermediate term as it ramps the important Model Y product as well as new factories in Berlin, Germany and Austin, Texas, and in the long-term as it increases its mix of software revenue.”

Related posts

February 1, 2023

Bitcoin closes out best January since 2013


Read more

Categories

  • Business
  • Content
  • Exchange
  • Inflation
  • Investment
  • Markets
  • Personal Finance
  • Technology
  • Uncategorized

Archives

  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021

Recent Posts

  • Bitcoin closes out best January since 2013
  • More oil is coming
  • Samsung to keep up chip investment, undeterred by 8-year-low profit
  • TikTok faces a daunting calendar ahead in Washington
  • Think Chevron’s Profit Was Obscene? 5 Companies Will Blow It Away

About Us

The Alpha Cut a Vida Street LLC Company
1404 N. Ronald Reagan Blvd.
Suite 1120
Longwood, FL 32750

Link

(843) 256-4375
https://thealphacut.com

Why Us

Terms & Privacy
Policy & Procedure
Disclaimer

This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only.
Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.
All data in this communication is provided for informational purposes only and is not intended for trading or investing purposes. We expressly disclaim the accuracy, adequacy, or completeness of any data and content provided by financial exchanges, individual issuers, their respective affiliates and business partners and shall not be liable for any errors, omissions or other defects in, delays or interruptions in such data, or for any actions taken in reliance thereon. You agree not to copy, modify, reformat, download, store, reproduce, reprocess, transmit or redistribute any data or information found herein or use any such data or information in a commercial enterprise without obtaining our prior written consent.
We make no express or implied warranties or representations and shall have no liability whatsoever with respect to any data contained herein. The data may not be further redistributed or used to create indices or other financial products. This report and the views expressed herein are subject to change at any time based upon market or other conditions (such as domestic and global economic trends) and are current as of the date of publication hereof. The information, analysis, and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual or entity.
We emphasize that Investment in the securities of smaller companies can involve greater risk than is generally associated with investment in larger, more established companies, and can result in significant capital losses that may have a detrimental effect on the value of your investments.
Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.
Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional.
Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth.As with any structuring of a portfolio of investments, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns.
The information, analysis and opinions expressed herein are for general, impersonal information only and are not intended to provide specific advice or recommendations for any individual entity.

copyright © Alpha Cut 2021. All Right Reserved
The Alpha Cut a Vida Street LLC Company