Tesla Stock Expected to go as High as 39%

The stock experts at Jefferies have estimated that in the year 2016, Tesla's stock might fluctuate between $360 to $365.

By the next year, analysts have predicted that Tesla Stock might go as high as 39%. Dan Dolev, an analyst at Jeffries, investment banking and equity firm, had maintained his rating of Buy for the automotive and energy storage company, in a note that he wrote out to his clients. Along with maintaining a Buy rating, the stock expert has also given a price target to Tesla’s stock that would range from $360 to $365 in a year’s time.

The analyst’s confidence in the automotive company lies in its battery pack costs on which the research firm has done an in-depth Tesla stock analysis. The present valuation of the electric car company’s stock is based on its low cost Model 3’s demand and execution. The company is planning to keep the price of its Model 3 at $35,000 which would be half as compared to its Model S. The company’s sedan, which is rather categorized as pricey, is solely due to its battery pack, which costs 20% of its average selling price. If the company wants to be successful with its Model 3, it will need to lower these costs down a bit.

By the year 2020, Jefferies analyst suggests that the automotive company brings down its battery pack price by at least 50%. This 50% reduction in the battery pack price will prove to be quite beneficial in the future for the company, as it will help Tesla generate good amount of profits. He stated that doing so could bring the company to an ‘upper-end of peer profitability level.’

By reducing pack-level costs, Dolev is sure that Tesla will be able to save a lot of money on its total battery cost will be a big game changer for the company. By 2020, he says, that the prices can easily be reduced by 70% with the help of economies of scale, reducing cost per unit, supply chain restructuring etc. As per this calculation done by the analyst at Jefferies, which would reduce cost of pack-level, as well as cell-level, could reduce by 50% by the year 2020.

He strongly believes that if the company goes forward with these reduction plans, it will easily be able to get a profit margin of 23% on its Model 3 with a gross margin profit of 33% on its Model S and Model X. To the chief executive officer of the company, Elon Musk, this 50% reduction in costs does not seem unrealistic or even aggressive. The company stated that this is not the ultimate goal but rather the bare minimum that the company is looking for.

Is Tesla Going Towards A Share Price Of $365?

The auto manufacturing company is all set to launch not only its first low-end priced car, but also its battery packs soon, which is why analysts at Jefferies have given it a price target of $365 for a period of 12 months.

Tesla Motors is in the news again, and this time it is because of the highly ambitious share price the auto-making company has received from analysts at Jefferies, which has been raised to $365 from a prior target of $360. The analyst, Dan Dolev, who has presented the recent research note regarding the progress and potential of the electric car makers, also believes that the auto giant deserves to be presented with a buy rating as well.

The same analysts also showed that very soon the hybrid car producers would be going up on the Tesla stock by a massive 39%, which would be majorly supported by the upcoming battery project that would see batteries rolling out in the market soon. However, there are some analysts in the industry as well who believe that more than half of the industry is currently looking towards the release of the company’s first SUV Model X, which is to bring about a huge change in its business as well.

The auto making giant is currently looking towards launching its first car, which is aimed for general audience as well and has not been made to be a luxurious one. However, the same high-end features will be added to the low priced electric vehicle, which will come around at being $35,000.

The car will naturally be a smaller but analysts are of the opinion that if the automaker is looking towards selling more cars, it is necessary that it reduce the price of the car to some extent, as the batteries installed in the car would also be expensive. If the company really wishes to reach out to the masses and not just a particular group of the society, some changes will be needed to be taken.

Analyst Dolev who has made a research on Tesla cars is also of the opinion that this price of the cars will eventually come down in the future, precisely in the year 2020 because that is when the firm has aimed to put on as many EVs on the roads as it can.

If the battery production is carried out successfully, this plan of the firm could actually end up being true. Tesla Stock News also suggests that the giant is currently looking towards cutting down its cost by around 30-50 percent by the year 2020, which is being taken as close to impossible by some analysts. 

Tesla P85D Could Not Surpass Ferrari Yet Again

Ferrari succeeded in sabotaging Tesla in the drag race

The Internet has been bombarded with videos almost each month showing Tesla Motors Inc.’s upcoming most luxurious and expensive luxury car known as the P85D. The car has been shown testing its muscle power against other super cars that are equipped with internal combustion engine. So this time a drag race was conducted where the P85D with dual motor and all-wheel drive was supposed to combat the 458 Speciale.

This is extremely impressive for an electric powered vehicle. Tesla Motors certainly tops the list when it comes to other ICE cars in terms of initial torque that allow them to gain momentum. The electric car is said to have an impressive looking P85D’s impressive “931 Newton-Meter (687 pound-feet)” coupled with an instant torque that ensures a quick start.

However, once the car gains momentum, due to the fuel guzzling the car cannot keep the same pace. P85D has a relatively strong horsepower when comparing it to its electric car rival, the Ferrari 458. It was observed that Ferrari reached the finish line way earlier than Tesla’s electric car. Moreover, it also had ample time to take two beautifully revealed tire grilling spins to celebrate its victory.

As reported the Ferrari has a horse power of 630 HP whereas the horse power of P85D is 691 HP. Another factor that played an important role in the winning was the weight of these cars. As reported by Jalopnik, the accumulated weight of P85D was 4,936 lbs, where a quarter mile was covered by them in 11.8 seconds. O the other hand, Ferrari 458 has a net weight of 2,745 lbs that gives them a great edge in terms of the ratio for power to weight.

This is actually not the first time in Tesla’s history that Ferrari has been successful in ruining the dream of the electric car giant to be on the top. Earlier, Tesla previously combatted with Ferrari’s F12 and the results were strikingly similar according to latest Tesla news.

Irrespective of the fact that they have been strike of the mile race as potential competitors, it is a big deal for a 7 seater family sedan to be able to stand against the ICE supercars.  P85D might not be the winner in terms of the race but it certainly has the potential to become the industry giant due to its extreme efforts of bolstering innovation.  The company is striving to make a mark and is certainly disrupting the automotive industry on the broader canvas.