Tesla Rides AI Trend with 13 Consecutive Rises, Analysts Warn Stock Prices Will Fluctuate Again
The reason for Tesla's continuous rise is that the market believes that Tesla is primarily a concept stock in AI, and secondarily an automotive stock. Investors may be valuing Tesla in ways beyond traditional automotive stocks.
Overnight in the US stock market, Tesla's 14-day winning streak was broken, but its 13-day consecutive rise has already set the record for the longest winning streak in history.
What supports Tesla's continuous rise? Adam Jonas, Morgan Stanley's chief auto analyst and a "favorite" of Tesla analysts, pointed out in a report on Thursday that investors are usually good at adding the stock market theme narrative "AI" to it.
The market believes that Tesla is primarily an AI concept stock, and secondly an auto stock. Investors may value it in ways beyond the auto/hardware model.
Currently, Tesla's stock price has soared, exceeding Jonas' basic target price of $200 and is rapidly approaching the November 2021 historical high of $390 in a bull market scenario. Specifically:
Core auto business $194/share (assuming 10 million vehicles by 2030, EBITDA profit margin of 22%), Tesla Energy $55/share (gross profit margin of 30% by 2030), network services $48/share (25 million MAUs by 2030, ARPU of $120/month), third-party supply of electric vehicles/batteries $40/share, Tesla shared cars $37/share, Tesla insurance $16/share.
Looking ahead, Jonas believes that profit expectations will not be substantially raised:
Although Tesla has recently rebounded, we expect that Tesla's consensus profit expectations will not be substantially raised. In the context of intensified competition in the electric vehicle industry and a slowdown in auto consumption, car prices will continue to deflate.
At the same time, Jonas said that Tesla's stock price will return to volatility:
Tesla's longest winning streak is consistent with double-digit returns, but its subsequent price performance is volatile in both absolute and relative terms. After this historic rise ends, Tesla's stock price will return to volatility.
From the perspective of market value, Bloomberg pointed out on Wednesday morning that Tesla's revenue exceeded 90% of the components of the Nasdaq 100 index. From a technical perspective, this rise pushed its relative strength index to 88, indicating that a stock may have risen too much.