The new Tesla Model 3 reviews and an increased production of cars are among several of the reasons one analyst is very bullish on the automotive company moving forward. Another is their new vehicle that’s one the way which could be a real game-changer in the automotive industry. Those factors along with Tesla’s continued work on their Gigafactory in the United States could give the company some serious advantages in terms of competing in the industry. However, there are other analysts who don’t seem to feel the company will perform so well despite their latest innovations, news, and improvements.
The Tesla stock has been on a very nice rise over the past year. It’s moved from a low of around $178 and has neared the $400 mark. One analyst believes it will cross that high and is a great long-term pick. On Tuesday, Benzinga.com reported that Baird financial analyst Ben Kallo is still extremely bullish on the Tesla company and its stock, despite such a huge run over the past 52 weeks. Kallo’s positive outlook comes thanks to Telsa’s latest releases and future news that’s on the way. Among that news will be more positive reviews regarding their Model 3 cars which are being delivered. Reviews will lead to headlines which should impact the stock price positively, according to Kallo.
As of right now, the car may draw favorable reviews, but Tesla is not producing these vehicles all that fast. That could change with the Gigafactory. On Monday, Business Insider reported on the Tesla Gigafactory which has been under production in the state of Nevada since 2014. They noted that Kallo indicated Tesla’s Gigafactory is currently “only 30 to 35 percent complete” in terms of ramping up production. However, in a note to clients, Kallo indicated that things have picked up there since his previous visit.
“Activity at the Gigafactory has increased since our tour in January, and we believe cost reduction and capacity expansion efforts are on track. Tesla will continue to have a battery cost advantage over competitors given its scale of production [of the Gigafactory] in Nevada.”
Tesla is hoping that they’ll be able to produce about 20,000 vehicles a month by the end of this year. As of this report, they have an estimated 500,000 or so back orders of the Tesla Model 3 and customers who order one now will be waiting for several months, at least. The Gigafactory is expected to help them increase production and lower costs.
Kallo believes that not only will the Tesla Model 3 production and reviews help to boost the company’s stock moving forward but another upcoming vehicle release could. The Tesla semi-truck is coming to market with an estimated 300 miles of operation. Kallo suggests that it will be “a major disruptor in the trucking industry.”
Tesla CEO Elon Musk tweeted that the unveiling of the first-ever semi truck for the company will take place on October 26. Some analysts believe the Tesla’s new semi-truck will cost as much as $100,000, but there could be high demand. It could be especially useful for regional deliveries rather than long-haul trucking, but still looks like a possible “game changer” from Tesla.
While Baird’s Kallo is bullish on the stock, other analysts aren’t as positive in their outlooks. As the Motley Fool reported, Jeffries & Co. initiated their coverage of Tesla stock with an “underperform” rating and a $280-per-share price. The reason behind their bearish outlook is due to their belief that Tesla’s mix of products is “declining faster” than battery cost. While the company may be selling more Model 3 sedans for a much lower price than their Model S. However, Jeffries & Co. believes that gives them a less profitable mix of vehicles being sold and won’t help the company’s bottom line.
As of this report, the Tesla stock (TSLA) was trading at $274.94, down $10.06, or just over two percent from where it opened on Tuesday.
[Featured Image by Joe Raedle/Getty Images]