Tesla stock is poised to rebound in the second half of this year as things finally start to pick up for the long-suffering electric car maker, according to Wedbush’s Dan Ives.
Ives, who has touted Tesla’s expansion prospects for years, said he remains bullish on the company despite lackluster performance so far in 2024. The stock is down 18% in 2024, a loss largely due to declining demand for electric vehicles. and the expansion of competition in China and the drama stemming from Elon Musk’s multiple legal battles, Ives has said in the past.
But those headwinds are abating, especially as the situation begins to stabilize in China, Ives said. Tesla has stopped applying price cuts to its main car models, a possible sign of firmer demand.
“They’ve had huge headwinds in China and now we’re seeing a recovery,” Ives said in an interview with CNBC on Friday.
Tesla’s second-quarter deliveries, which the company is expected to announce this week, will likely be disappointing, but will likely be the “last of the worst news” for the automaker, he said.
Tesla is also expected to unveil its Robotaxi at an event in August, a fully autonomous car model that Musk has been teasing for months. The launch could be a major turning point for Tesla’s stock, Ives said, calling the robotaxi a “magic style” for the company in the past.
Those gains could be amplified if Trump is re-elected to a second term, as Trump is “pro-Musk” to President Joe Biden, who has “actively ignored” Tesla, Ives said.
Wedbush reiterated his “outperform” score on the stock and his price target of $275, implying a 33% increase from existing levels.
“The story of the ‘return of the kids’ for Musk begins, of course, with Robotaxi Day in August. I think it’s a name that’s going to get a lot of traction in the second part of the year,” Ives said. I think stocks tell you that. . . the worst is in the rearview mirror for Musk and Tesla. “
Other analysts aren’t so sure. Longtime investors and banking analysts have warned that Tesla could see a drop of up to 91%. This is due to key issues with the company’s business model, as well as the fact that obstacles to expansion can last for years, according to Wells Fargo. strategists said earlier this year.
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