$500 Price Target Amid Bullish Optimism

Tesla’s share has attracted attention once again and not due to any controversial Elon Musk tweet, but because Wedbush has not only reaffirmed its bullish call but also doubled its rating, along with keeping its price target for the electric vehicle leader at a whopping $500.

While Wall Street is divided between doubters who call the company overvalued and believers who say Tesla will go to the moon, the stock of Tesla is undoubtedly the drama series from the stock market, where Elon Musk is playing the main role.

On Friday, Tesla was approved once again with a positive signal from Wedbush, which confirmed that they are sticking to their Outperform rating with a price target of $500. This is the analyst’s highest estimate of the 115-500 dollar range. The optimistic attitude is indicative of the lingering support from investors to Tesla amid uncertainties surrounding the company’s valuation and volatile markets.

As per the InvestingPro data, Tesla’s share is currently overvalued with a P/E ratio of 184, which basically means that the market is anticipating that Tesla will be able to deliver its growth ambitions consistently.

Musk’s Long-term Commitment with Tesla

The main reason for Wedbush’s positive view is CEO Elon Musk’s promise to stay with Tesla through 2030. This confidence comes after the incentive schemes that the Tesla Board of Directors approved for Musk earlier this year. Wedbush suggests that Musk’s presence is like a lighthouse giving safe guidance to Tesla when the company plans to conquer the autonomous driving and robotics markets. The company went on to mention that this action is just one of three steps that were laid out in July for securing Musk’s leadership over the long-term, which will also speed up Tesla’s next stage of growth.

Growth Drivers

With Musk’s strong leadership position, Wedbush highlighted that Tesla is initiating one of the most significant chapters of its growth journey. The approaching prospect includes further development of the Full Self-Driving (FSD) technology, the scaling of the robotics sector, and the company’s international expansion.

The recent update in operations reflects this path. In August, Tesla announced a rise in new car sales in the UK by 7.63%, which means electric vehicles are becoming more popular in Europe. On the other hand, the volume of shipments in China increased 22.5% from July to 83,192 units despite the presence of some macroeconomic headwinds.

Analysts are Divided

Tesla remains a hot topic that divides the opinion of Wall Street analysts. For example, Piper Sandler decision went along with a rating of Overweight with a price target of $400. In their view, Tesla’s FSD technology development is the main driver of Tesla’s positive trajectory.

At the same time, Wedbush’s $500 target reflects the belief that Tesla can unlock the innovative potential of autonomous driving and robotics. However, such a high valuation leaves only a small room for mistakes, and the Tesla skeptics are saying that there are a lot of risks in execution.

Product Developments and Operational Updates

Besides expectations of stock prices, Tesla is also making news with various updates in products and operations. One of the changes the company made was to their Cyberbeast Model. The price was increased by $15,000, which brought it to $114,990, and with the addition of the new Luxe Package, it is expected to provide more comfort and safety.

In terms of its technological innovation, the firm is planning to extend the robotaxi service in the Austin area, which is a next step in the launching of FSD version 14 by the company that is expected soon. Both moves are meant to consolidate the company’s leadership in mobility technology.

Bottom Line

The reaffirmed $500 price target by Wedbush illustrates their confidence in Tesla’s future path over the long term, along with Elon Musk’s pledge to be the company’s leader until 2030 as the main support. Even though Tesla’s valuation puts the company at risk of market fluctuations, its development in self-driving, robotics, and international markets are the reasons why there are still strong reasons to be bullish on Tesla.

For investors, Tesla is still a high-risk and a high-reward investment. The company’s future prosperity depends on whether Musk can achieve his challenging goals and at the same time navigate through a fiercely competitive EV market.

Sure, the company is revolutionizing with FSD, expanding robotics, and taking over new markets, but none of this is a surprise to the stock, it goes beyond it. Investors must consider that they are investing in Tesla’s company, or in buying Musk’s charisma? If the answer tilts toward the second, then this is not simply an investment, it is a leap of faith.