In his latest note to investors, Piper Jaffray analyst Alexander Potter has increased his price target on Tesla’s stock to $423 a share up from previous $372, saying that “it’s hard to find a more impactful disrupter than Tesla,” Yahoo! Finance reports.
Potter noted that the electric car maker has always had a strong mission and loyal base of customers, more recently the company has demonstrated impressive capabilities.
“For all its controversy and volatility, we think TSLA is a must-own stock in the auto sector,” the analyst added. He also highlighted Tesla’s high-volume manufacturing, “impressive opex control, and frugal capital spending.”
Piper’s new 12-month price target, which represents more than 25% climb from Tesla’s previous close of $334.87 a share, is also influenced by the newly announced Cybertruck pick-up truck.
Potter said he was originally skeptical of the truck but then “began considering the possibility that ALL OTHER pickup trucks might actually be pretty crummy, and that Tesla’s Cybertruck is the only pickup worth ordering.” He said it’s no longer “far-fetched” to think that Tesla could sell 200,000 units annually beginning in 2023, an assumption now baked into his updated financial model.
While Tesla’s stock has been nearly flat throughout the year, it’s after the stock rallied nearly 50% in the past three months.