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Tesla investor day will help stock continue to re-rate higher, target up to $250 - DB

Published 2023-02-23, 07:56 a/m
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By Investing.com Staff

Tesla (NASDAQ:TSLA) will be hosting its investor day on March 1 and Deutsche Bank analysts believe the event can help the stock continue to re-rate higher. As a result, the analyst boosted the price target on the stock by 13.6% on Thursday - from $220 to $250.

At the event, the analysts expect the EV giant to introduce Master Plan 3 and present the main drivers of its longer-term growth strategy. This will likely include the company's 3rd generation vehicle platform, supporting "multiple future vehicles and segments at a lower price point." They also expect updates on its FSD software V11, hardware HW4, Cybertruck/Semi production, project Highland refresh of Model 3, and ramp-up of the energy storage business. Further, to support its volume and cost targets, they think Tesla "will speak about the role of in-house battery manufacturing technology, capacity expansion, and actions to secure raw materials."

Analysts said the most impactful items for the stock could be:

1) The lower cost trajectory of the next-gen platform (potentially targeting $20k in COGS/vehicle) and efficiency in capital and output, with details on how the company plans to achieve the anticipated scale and cost;

2) specific vehicles and segment launches based on next-gen platform and their timelines (Tesla has mentioned SOP as early as second half of 2024);

3) FSD V11 and Hardware 4 rollout plans that could support and boost the autonomous capabilities of the next-gen platform and potentially support robotaxis;

4) capital allocation framework with share buybacks.

"All in, we believe that increased clarity around the long-term trajectory for Tesla's global operations, volume growth, and especially scale and cost of Tesla’s next-generation models, could reinforce the bull case for the stock," the analysts conclude.

Shares of Tesla are up 1.4% in pre-open trading Thursday.

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