Tesla, Inc. TSLA shares have been stagnant since the company released its third-quarter earnings report in mid-October. The stock did not fluctuate despite the electric vehicle maker reporting above-consensus deliveries report last week. Nevertheless, an analyst on Friday reaffirmed his optimistic stance on the Elon Musk-led company.
Anticipated Reacceleration: Tesla’s sales, margins, and earnings per share are projected to reaccelerate in 2024, said Argus analyst Bill Selesky. In 2024, the factors that previously suppressed demand, namely a sluggish EV market, rising interest rates, elevated inflation, and supply-chain disruptions, are anticipated to turn favorable, the analyst indicated.
He expects interest rates to trend lower, inflation to decelerate, and supply chains to improve.
Tesla’s Competitive Edge: Tesla’s increasing reliance on artificial intelligence in manufacturing and factory utilization has bestowed upon it a significant competitive advantage, according to Selesky.
“Additionally, we believe AI is an undervalued component of the future growth at Tesla and expects its value to be recognized soon on Wall Street as FSD (full-self drive), battery cell production, and AI-enabled robots become a bigger part of the future at Tesla,” he stated.
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Poised for Growth: Tesla is the leader in the EV industry, accounting for approximately 50% of the U.S. EV market and 20% of global shipments, Selesky asserted. ‘We believe TSLA has an opportunity to grow market share in 2024,”‘ the analyst said.
Deepwater Asset Management’s Gene Munster indicated in his 2024 tech predictions that he expects Tesla to maintain its U.S. market share.
Selesky noted that recent entrants to the EV market, such as Ford Motor Co. F, General Motors Corp. GM, Toyota Motor Corp. TM and Volkswagen AG VWYAG, and brand new entrants, such as Nio, Inc. NIO, Lucid Motors, Inc. LCID and Rivian Automotive, Inc. RIVN, have been struggling to right-size their future capex budgets.
Argus has a “Buy” rating and a $316 12-month price target for the Tesla stock, suggesting a 33% upside potential.
Tesla ended Friday’s session down 0.18% at $237.49, according to Benzinga Pro data.
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