Tesla, Inc.TSLAshares barely budged despite all the hype surrounding the Cyber Rodeo event held this week. All the same, one analyst is confident that the stock will hit top gear and keep rising over the next decade.
What Happened: Tesla stock will go from a market capitalization of a little over $1 trillion currently to $10 trillion by 2030, New Street Research analyst Pierre Ferragu said in a tweet. The analyst said the Tesla growth story is slowly taking hold and the company is on track to see unprecedented scale and capture 20% of the auto market.
Ferragu, however, cautioned that his estimate is neither a forecast nor an investment recommendation, leaving it open to investors to decide for themselves.
The analyst's 2030 look ahead assumes 20 million units of vehicle sales and an average selling price of $35,000, translating to vehicle sales of $700 billion. About $1.5 billion will likely come from insurance, $35 billion-$70 billion from full-self driving software and $250 billion from energy, with real AI providing option value.
The total 2030 revenue will likely come in at $1 trillion, the analyst estimates. Applying a multiple of 8-10 times on estimated sales, the company's valuation will gallop to about $10 trillion, he added.
Where Will This Leave Tesla Stock: Tesla's outstanding share count is currently at 1.03 billion. If the share count remains unchanged, the per-share value of Tesla would be around $9,710.
Tesla detractors and skeptical investors may debate the credibility of Ferragu's model. Nevertheless, the company is poised to see superlative growth over the coming years. Tesla, according to many sell-side analysts, is not able to keep pace with the surging demand for its vehicles.
It may now have found a solution with the two more Gigas, in Berlin and Texas, coming online. Loup Fund analyst Gene Munster expects the company to deliver 1.8 million vehicles in 2023.
Tesla closed Friday's session down 3% at $1,025.49.