Overview
Last week, Bank of America raised Tesla's target price by 14%. Craig Irwin, an analyst who has been bearish on Tesla for a long time, upgraded the rating to "buy" and raised the target price by 347%. This week, Morgan Stanley raised the target price by 29%, and Goldman Sachs increased it by 38%. $Tesla Motors(TSLA)$’s stock price closed up nearly 6% on Wednesday, and Musk, whose three-fourths of personal wealth comes from Tesla stocks and options, refreshed the highest personal asset record of the world's richest man.
In the past week, Tesla's stock price has soared. Many major Wall Street firms have raised their target prices, and Tesla's stock price hit a three-year high. CEO Musk's net worth has further increased significantly, making him the world's first billionaire whose personal assets exceeded the $400 billion mark.
On Wednesday, December 11 EST, Tesla's stock price accelerated its upward trend during US stock midday session and once rose to $424.88 during closing perod, with an intraday increase of about 6%, hitting a new intraday historical high. It finally closed up more than 5.9% at $424.77, rising for six consecutive trading days and refreshing the closing high record set on November 4, 2021.
Goldman Sachs Raises $Tesla Motors(TSLA)$’s Target Price by 38%, and Long-Term Bearish Analyst Irwin Increases It by 347%
Before Tesla's further rise on Wednesday, Goldman Sachs analyst Mark Delaney just raised Tesla's target price from $250 to $345, an increase of 38%, and maintained a "neutral" rating. Although Delaney's upgraded target price is still significantly lower than Tesla's closing price above $400 on Tuesday, his report, like those of other institutions, is optimistic about the positive impact of autonomous driving and robotics technology applications on Tesla's stock price.
Delaney wrote in the latest report that Goldman Sachs believes that Tesla is in a leading position in the platform and power fields, and in the broader clean mobility field (including electric vehicles, energy storage, software, and charging). Meanwhile, Goldman Sachs believes that Tesla will face resistance in its core automotive business in the short to medium term, with factors including the slowdown in global electric vehicle demand growth and pricing pressure.
Analysts such as Delaney at Goldman Sachs believe that given the growing market interest in potential AI beneficiaries, Tesla's stock may still maintain a relatively high PER, reflecting the long-term opportunities related to Tesla's autonomous driving technology FSD or robots.
Before Goldman Sachs, other Wall Street institutions also raised Tesla's target price in the past week. Morgan Stanley raised the target price from $310 to $400, an increase of 29%, maintaining an "overweight" rating. Cantor Fitzgerald even significantly raised the target price by 43% to $365, maintaining a "neutral" rating. Morgan Stanley's analysts listed Tesla as their top pick, saying that the strong sales momentum will help Tesla set a new record in China in the fourth quarter.
Musk Refreshes the Highest Personal Asset Record of the World's Richest Man
With the rise in Tesla's stock price, Musk's personal wealth has further expanded. During trading hours this Wednesday, the Bloomberg Billionaires Index showed that Musk's personal net worth exceeded $400 billion, making him the world's first person with a net worth exceeding the $400 billion mark and refreshing the highest asset record as the world's richest man.
As a major contributor to Trump's election as president, the companies under Musk generally saw their valuations soar after the election. From the end of the election day on November 5 to the closing on Wednesday this week, Tesla's stock price has risen by about 69%, and its market value has increased by more than $556 billion in five weeks.
Analysts attach importance to Musk because of the possible influence he may have on future US government decisions due to his close relationship with Trump. Musk said at Tesla's third-quarter earnings call in October that he intends to use his influence on Trump to establish a "federal government approval process for autonomous vehicles." Currently, the approval is completed by state-level government agencies.
On November 6, the first day after the election, Dan Ives, an analyst at the investment bank Wedbush and a die-hard fan of Musk, bluntly expressed his optimism about Musk and Tesla, saying that "the biggest beneficiary of Trump's victory will be Tesla/Musk."
Meanwhile, Wedbush analysts raised Tesla's target price from $300 to $400, because "they believe that Trump's entry into the White House will change the autonomous driving and AI story of Tesla and Musk in the next few years."
Documents submitted to regulators show that Musk holds more than 411 million shares of Tesla stock and approximately 304 million performance-based stock options. Tesla stocks and options account for about three-fourths of his personal wealth. He also holds lots of shares in SpaceX, X, and xAI.
Bloomberg reported that the recent sale of stocks by SpaceX insiders alone increased Musk's net worth by about $50 billion to $439.2 billion. On Wednesday this week, SpaceX and its investors agreed to buy $1.25 billion worth of the company's stock from insiders such as employees, bringing SpaceX's valuation to approximately $350 billion, making it the world's most highly valued private startup.
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