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Wedbush maintains Outperform on Tesla ahead of 'historical' launch event

Published Nov 28, 2023 15:50
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Wedbush reiterated an outperform rating on Tesla (NASDAQ:TSLA) with a 12-month price target of $310.00 on the stock as the electric automaker prepares for their much-anticipated Cybertruck delivery event this Thursday at the company’s Austin gigafactory.

“This is another historical moment for Tesla and Musk with the Cybertruck unveil as the Street is excited to see the formal vehicle launch,” wrote Wedbush analysts in a note.

Although the electric automaker has not disclosed FY24 delivery targets, Wedbush estimates suggest Tesla is likely to produce between 2,000 to 3,000 units this quarter.

Tesla is also anticipated to produce 10,000 units in the first half of 2024. The pilot production capacity established in Austin is set at 125,000 units.

However, reports indicate that reservations or pre-orders have surpassed the approximately 2 million unit mark, serving as a significant indicator of demand.

When first introduced in 2019, Tesla unveiled a pricing structure starting at $39.9k for the base single-motor RWD version, $49.9k for the dual-motor AWD truck, and $69.9k for the tri-motor AWD variant.

However, Wedbush analysts expect updated pricing to be released Thursday during the event.

“Whisper numbers for the single motor are in the ~$50k range, with prices for the dual and tri-motor variants likely to be in the $60k - $80k range.” Wedbush analysts wrote in a note.

The production ramp-up for the Cybertruck is expected to be challenging, as highlighted in the recent conference call where Musk & his team mentioned that they do not anticipate achieving positive cash flow from this vehicle for another 12 to 18 months.

Launching the truck is seen as a broader and more important goal for the company’s growth story overall.

Although the Cybertruck doesn't substantially impact Tesla's financials in FY24, Wedbush believes it serves as a testament to Tesla's innovation and position over traditional OEMs around the world.

Shares of TSLA are down 0.19% in mid-day trading on Tuesday.

Wedbush maintains Outperform on Tesla ahead of 'historical' launch event
 

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