Tesla (TSLAStocks jumped Monday after six straight losses, as excitement around the Cybertruck and a China-developed Model 3 vehicle appeared to be building.
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TSLA stock jumped 7.3% to 231.27 in market trading Monday after Baird analyst Ben Calo outlined several catalysts for the stock in the second half of the year.
Car price cuts and pressure on Tesla’s gross margins will continue to be the main story for the global EV giant, Kallo wrote Monday. However, Kallo added that TSLA could be pushed higher by the launch of the Cybertruck — expected in Q3 — and other factors. Baird maintains an outperform rating of TSLA with a price target of 300, 39% higher than where the shares are currently trading.
Numerous sightings of Cybertrucks on US roads are generating excitement online about the vehicle’s expected release. Social media users recently spotted an e-kart in Iceland, in what appears to be a promotional video.
Tesla is also set to launch its updated Model 3, codenamed Highland, in China. Some stores are already taking reservations, according to local reports. Late last week, Bloomberg reported that mass production of the new Model 3 is expected to begin in September.
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TSLA stock has been declining since its second-quarter financial data was released on July 19. Investor concerns about lower gross margins beat the global electric car giant’s profits and revenues above expectations. News of sales from Cathy Woods’ ETFs may have fueled some bearish momentum.
Tesla stock fell more than 11% to 215.49 last week on the back of six straight losses. The stock is still above the 200-day moving average. TSLA is now at its lowest since closing at 213.97 on June 2nd. Two weeks ago, Tesla stock trimmed support at the stock’s 50-day and 10-week moving average. TSLA ended that week more than 2% below its 10-week line, which is a clear sell signal, according to IBD Analysis.
While Tesla stock fell nearly 20% in August, on Wednesday, Wedbush analyst Daniel Ives, a longtime Tesla bull, told CNBC that it remains “strongly bullish.”
“I view it as a sell-off after the quarter, and concerns about China,” Ives said. The analyst added that he views this as an “opportunity” and that Tesla is “a board game on these levels.”
Tesla stock ranks fourth in IBD Automotive Group. It has a composite rating of 91 out of 99. Tesla stock has a relative strength rating of 79 and its EPS rating is 94 out of 99.
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