This post was originally published on this site
Wedbush reiterated an Outperform rating on Tesla (NASDAQ:TSLA) and raised the price target on the stock to $225.00 (From $200.00) following recent survey work. Based on the survey work, analysts believe that the China EV reacceleration story for Tesla is just starting to hit its stride and should be a tailwind in 1Q.
They wrote in a note, “While China demand was a headwind for Tesla in 4Q with the lockdown and macro uncertainty, we are now seeing a noticeable turnaround for Chinese EV buyers favoring Tesla vs. domestic players (BYD, Nio, Xpeng). The price cuts have swayed 3 of every 4 EV buyers in China based on our survey work in China and Tesla’s unmatched ability to scale its production operations in China are meaningful to margin stability which are front and center for the Street.”
On Friday, President Biden and his administration changed the definition of EVs classified under the $80k SUV cap. As such, Tesla raised their Model Y’s price by roughly $1,500. With the $55k cap no longer in play and robust demand, analysts believe that we could see some modest price increases over the coming months that give more flexibility to Tesla with the tax credit now set.
Shares of TSLA are up 1.55% in pre-market trading on Monday.
