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On Monday, Canaccord Genuity reiterated its Buy rating and $404.00 price target for Tesla stock (NASDAQ:TSLA), which currently trades at $278.39 with a market capitalization of $892.45 billion. The firm’s analyst, George Gianarikas, adjusted the delivery estimate for the first quarter of 2025 to approximately 362,000 vehicles, down from the previous estimate of around 331,000 vehicles. Despite this increase, the new forecast remains below the consensus estimate of approximately 417,000 vehicles. According to InvestingPro data, 10 analysts have recently revised their earnings estimates downward for the upcoming period.
Gianarikas explained that the revised estimate takes into account several factors, including anticipated consumer behavior and production challenges. He indicated that potential buyers might be postponing their purchases to wait for the new Model Y. Additionally, comments from Tesla’s fourth-quarter 2024 earnings call were cited, where the company mentioned significant factory retooling for the new Model Y, which is expected to temporarily affect production output. With annual revenue of $97.69 billion and a P/E ratio of 123.19, Tesla maintains its position as a dominant player in the automotive sector. InvestingPro subscribers can access detailed financial health scores and 18 additional key insights about Tesla’s current market position.
Canaccord’s analysis suggests that the current situation with Tesla might be misunderstood by some as a loss of overall momentum for the company. Gianarikas pointed out that, while there could be some impact from macroeconomic conditions and brand perception, the main reasons for the adjusted delivery numbers are likely supply constraints and certain demand factors.
The firm’s stance on Tesla remains positive, despite acknowledging the short-term production issues related to the Model Y retooling. Gianarikas expressed curiosity about whether the delays in purchase decisions and the production limitations are being misinterpreted, emphasizing that these factors do not necessarily indicate a halt in Tesla’s overall progress.
In summary, Canaccord Genuity maintains a bullish outlook on Tesla, with the belief that the company’s delivery figures for the first quarter of 2025 are primarily influenced by supply limitations and some demand-related factors, rather than a broader decline in consumer interest or company performance.
In other recent news, Tesla is under investigation by the FBI due to a surge in violent activities targeting the company. The FBI has labeled these incidents as "domestic terrorism" and is taking steps to address and reduce them. Despite these challenges, Piper Sandler has maintained its Overweight rating for Tesla, setting a price target of $450, citing supply constraints as the primary reason for anticipated delivery shortfalls, not demand issues. The firm also highlighted potential growth opportunities through new product launches and a planned robo-taxi service. Meanwhile, Gene Munster from Deep Water Management commented on Tesla’s expected earnings adjustments, suggesting current forecasts might be overestimated by 17%. Despite this, Munster remains optimistic about Tesla’s long-term potential. Additionally, Tesla faces stiff competition from BYD (SZ:002594), which has surpassed Tesla in annual revenue, reporting $107 billion compared to Tesla’s $97.7 billion for 2024. BYD’s advancements in fast-charging technology and driver assistance features have contributed to its strong market presence, particularly in China. Tesla’s market valuation, however, remains significantly higher at about $800 billion, despite recent stock price declines.
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