Analysts at Morgan Stanley boosted their bullish case on Tesla.
Morgan Stanley analyst Adam Jonas set a $1,200 price target on the electric carmaker’s stock in a bullish scenario, compared to the firm’s previous target of $650 a share. The new price target represents about 50% upside from the company’s closing price on Friday.
Jonas also hiked the base case target on Tesla to $500 from $360. The base case represents nearly 38% decline from the stock’s current price.
The latest bull case reflects 4 million units of auto volume by 2030 with a 12% operating margin. According to Jonas, Tesla has the opportunity to supply powertrains, including batteries and electric motors, to other vehicle manufacturers.
The base case forecast includes 2.2 million units and a 10% operating margin margin by 2030,
However, Jonas warned that investors should expect a “very challenging” first quarter for Tesla. According to his projection, Tesla will deliver 89,000 vehicles in the quarter, which is lower than Wall Street’s consensus view of 99,000. Jonas also said that Tesla will report a quarterly loss of about $440 million.