Shares of Tesla Inc. (NAS:TSLA) rose 2.2% in premarket trading Friday, bouncing after a 5.9% drop over the past two days, after Wedbush analyst Dan Ives raised his price target to above current levels, citing signs of "robust and stronger-than-expected" demand in China. Ives raised his price target to $475, which is 12.2% above Thursday's closing price of $423.43, from $380, while reiterating the neutral rating he's had on the stock since April 2019. "The pent-up demand in the China EV market for Model 3's and recent price cuts are catalyzing strong unit deliveries for Musk & Co. in this key market with increased market share vs. domestic competitors as the Giga 3 success story continues to play out," Ives wrote in a note to clients. He said because Model 3s sold in China have incrementally higher margins compared with those sold in the U.S. and Europe, he believes the strength in China could increase Tesla's profitability profile over the next few years. And for the much-anticipated Battery Day scheduled for Sept. 22, Ives said Chief Executive Elon Musk will announce a number of potential "game changing" battery developments. The stock's selloff the past two days snapped a 5-day win streak in which the stock soared 36.2%, which in turn came after a five-day bear-market selloff in which the stock sank 33.7%. It has run up more than fivefold (406.1%) year to date, while the S&P 500 (S&P:SPX) has gained 3.9%.
Sept. 18, 2020, 6:31 a.m. EDT