Tesla Inc. hit a record high Monday after receiving a $3,500 bull-case target at one Wall Street firm.
Shares touched a peak of $2,129 after Wedbush analyst Dan Ives said strong Model 3 demand from China and potential “game-changing” battery developments will drive the stock up as much as 70% from current levels. Ives previously had a bull-case target of $2,500.
“We believe that the China growth story is worth at least $400 per share in a bull case to Tesla as this EV penetration is set to ramp significantly over the next 12 to 18 months, along with major battery innovations coming out of Giga 3,” wrote Ives, who left his “neutral” rating and 12-month price target of $1,900 unchanged.
Ives believes Tesla’s China business could generate earnings of more than $35 per share, up from his previous estimate of $20 to $25, and expects “game changing” developments to emerge from the upcoming Sept. 22 Battery Day.
Monday’s advance comes despite investors no longer having the chance to get in on the upcoming 5-for-1 stock split as the deadline to do so passed at the close of business on Aug 21.
The announcement of the split, alongside the car maker’s better-than-expected second-quarter results, ignited a 49% rally in the stock since Aug. 11. Shareholders of record as of last Friday will at the Aug. 31 close receive an additional four shares for each share owned.
Tesla shares were up 390% this year through Friday while the S&P 500 was up 5.15%.