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Tesla Target at $1,200 in Morgan Bull Case; Shares Jump Again

By Kim Khan

Investing.com - Tesla (NASDAQ:TSLA) was climbing again Tuesday after Morgan Stanley (NYSE:MS) predicted a 50% jump in shares in its most optimistic scenario, while Bernstein bumped up its projection of where the stock is headed.

Shares of the electric automaker rose 6.4%.

While Morgan Stanley (NYSE:MS) is still skeptical about Tesla in its base case (considered the default view comparable with other Wall Street banks), in its bullish case it sees shares running up to $1,200 per share.

“Our new bull case reflects 4 million units of auto volume by 2030 with a 12% operating margin,” Morgan Stanley analyst Adam Jones said in a note. “This compares with our base case forecast of 2.2 million units and a 10% OP margin by 2030.”

In its base case, Morgan maintained its underweight rating, with shares falling to $500 per share, citing unfavorable risk/reward, although that’s up from its previous base target of $360.

Also today, Bernstein raised its price target on the stock to $730 from $325, keeping its market preform rating, calling it the “ultimate possibility stock”.

Analysts Toni Sacconaghi wrote that even if Tesla’s market share drops by 50%, its compound annual growth rate can still be 15% for 20 years.

“We are skeptical that upside possibilities are likely to be expunged any time soon -- suggesting no imminent negative catalysts for the stock,” Sacconaghi said.

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