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Tesla stocks jump as Wall Street bets on Model 3

Tesla stocks

Tesla stocks rose in trading on Thursday after the company released its second quarter results. Tesla photo.

Tesla stock up 63 per cent in 2017

Tesla stock got a bump of 6 per cent on Thursday after its quarterly report beat average analyst estimates and boosted bets that the Model 3 will shift the California-based electric automaker into the mainstream.

Since the beginning of 2017, Tesla stock has jumped 63 per cent.

Accelerate KootenaysThe Q2 report showed the company had received over 1,800 reservations per day for the Model 3 since it launched last week.

Tesla reported $3 billion in cash in hand at the end of the second quarter, which reassured investors who grew concerned after chief executive Elon Musk said the company would face “manufacturing hell” in the coming months in ramping up production of the Model 3.

Further, Musk said investors should have “zero concern” that the Palo Alto company would not reach its production target of 10,000 vehicles per week by the end of next year.

After the release of the quarterly report, at least two brokerages raised their price targets.  RBC Capital Markets raised its target price by $31 to $345, well over the median price target of $322, according to Thomson Reuters data.

“While we don’t have meaningful reason to doubt that Tesla can eventually achieve its targets, doing so in a timely manner without some growing pains could prove challenging,” RBC Capital Markets analyst Joseph Spak wrote in a research note.

The Model 3 has a base price of $35,000 and is Tesla’s least expensive car and is designed to compete with the Audi A4, BMW 3-series or Mercedes C-Class, which typically sell between $40,000 to $50,000.

Consumer Reports said that GM’s $37,495 Chevy Bolt reached 250 miles on a single charge.  That beats out the Tesla 2016 Model S 75D and 2016 Model X 90D.

“A new Tesla Model S or X 100D would probably beat the Bolt’s range, but you’d have to pay $100,000 or more for one of those cars,” Consumer Reports said.

Accelerate Kootenays

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