Tesla’s stocks skyrocketed once again after Bernstein analyst Toni Sacconaghi nearly doubled his price target, arguing that he can’t see any negative catalyst against the capital so far and in the coming weeks, that wasn’t especially expensive. The tech-based car maker’s shares reach up to $850 Tuesday before paring gains.
The electric-car maker’s stock TSLA, +5.97% rose as much 7.5% to an intraday high of $860.00, before paring gains to be up 5.8% in midday trading. It has now more than doubled (up 102%) just this year. The stock is 4.6% below its record close of $887.06 earlier this month. Sacconaghi also raised his stock price target to $730, which is still 14% below current levels, from $325.
In the same behavior, Elon Musk’s company’s shares soared more than 19% on February 4 after Argus Research analysts raised its price target from $556 to $808. The spike in Tesla’s stock prices is the biggest one-day gain for the company since May 2013.
The research firm attributes the rise in price target to Tesla’s strong fourth-quarter financial report, which exceeded Wall Street’s expectations last week. Furthermore, Argus Research also raised its earnings per share estimate to $8.01 from $5.96 and expects that to double by 2021.
Because of these meteoric rises in Tesla’s stocks in the past few weeks, Sacconaghi said that he has been thinking about how to value Tesla. He added that using traditional industry valuation metrics; it would be difficult to justify the carmaker’s stock prices, suggesting the considerable possibility that Tesla will end up more profitable than Volkwagen.