Tesla Stock Price Target Raised to $310 by Piper Sandler Analysts | Increased Delivery Estimates and Lower WACC Driving Growth
In a recent update, Piper Sandler analysts have raised their price target on Tesla (NASDAQ: TSLA) stock to $310 from $300, citing improved delivery estimates and a lower weighted average cost of capital (WACC). The revision is fueled by higher vehicle deliveries, especially for fiscal year 2024, where Tesla is expected to deliver around 1.75 million units, up by 23,500 units from previous estimates.
For Q3 alone, Piper Sandler predicts Tesla will deliver close to 459,000 units, reflecting a 5.4% increase year-over-year. Analysts are particularly optimistic about Tesla's performance in China, where they anticipate the company to deliver over 175,000 units in Q3.
Despite weak demand in Europe, Cybertruck deliveries are expected to boost Tesla's U.S. sales. The company's "Rest of World" regions are also projected to account for 12% of total deliveries in Q3, with potential to surpass the current estimate of 55,000 units based on past performance.
Additionally, analysts highlight a reduction in Tesla's WACC to 13.3% from 13.5%. However, they caution that upcoming developments around Tesla's robo-taxi program, set for a major unveiling on October 10, could overshadow the focus on delivery numbers.
Piper Sandler maintains its Overweight rating on Tesla stock, but notes potential risks such as production delays, customer dissatisfaction, or supply chain disruptions. Investors should keep a close eye on Tesla's future performance and strategic developments to make informed decisions about their investments.
In conclusion, Tesla's stock is expected to see growth in the coming quarters due to increased delivery estimates and a lower WACC. Investors should consider the potential risks and rewards associated with investing in Tesla, especially in light of upcoming developments like the robo-taxi program unveiling. Stay informed and stay ahead in the dynamic world of financial markets.