Tesla has risen for nine consecutive days! But Wall Street has a wide difference of opinion

Unconsciously, Tesla has risen for 9 consecutive trading days.

Recently, Tesla's stock price has been skyrocketing, with a 0.56% increase in closing on Monday, pushing the stock price to $252.9, marking a continuous rise for 9 trading days.

Although the 9-day continuous rise is impressive, Wall Street analysts have a significant difference in their future outlook for Tesla's stock price. The difference between their highest and lowest target prices for Tesla is about $200, equivalent to 80% of Monday's closing price, while for Apple, another "Big Seven" stock, this ratio is about 40%.

This is not surprising, as Tesla's stock price performance is more extreme and unstable. Over the past five years, Tesla's stock has been above Wall Street's average target price for nearly 50% of the time, while Apple's stock has only been above the average target price for 20% of the time. This indicates that Tesla's stock price volatility is much higher than Apple's.

Moreover, as one of the "Big Seven" US stocks, Tesla was the only stock among the seven to have incurred losses in 2024 until last week. Thanks to the 9-day rise, Tesla's year-to-date increase has finally reached about 2%.

As of Monday, the average increase for Microsoft, Nvidia, Apple, Amazon, Alphabet, and Meta, the other six giants, in 2024 is about 53%, leading by a wide margin.

Tesla's 9-day rise is attributed to better-than-expected electric vehicle deliveries

Some analysts believe that the new energy vehicle business is the driving force behind Tesla's continuous rise in stock price.

Gary Black, co-founder of Future Fund Active ETF and a Tesla shareholder, pointed out that with delivery pressure easing, the core electric vehicle business has stabilized, playing a key role in Tesla's stock price increase.

On July 2nd, Tesla announced that its second-quarter car deliveries exceeded expectations. Delivering 443,000 vehicles, it was higher than market expectations. Although it decreased by 4.8% year-on-year, the decline was not significant, as Wall Street had previously expected a drop of over 15%.

The strong performance in new energy vehicles has brought confidence to investors, believing that Tesla can achieve growth again in 2025. The market expects Tesla's 2024 delivery volume to reach around 1.8 million vehicles, on par with 2023. The better delivery volume has also stabilized profit forecasts. Wall Street initially estimated Tesla's earnings per share to be around $3.8 at the beginning of the year, but the current expectation is around $2.4.

Brian Rauscher, founder of BFR Research, stated that investors dislike buying stocks with declining profit expectations. Although Tesla's profit expectations have not risen, they have improved, which is often sufficient for investors

Tesla's 9 consecutive gains, also driven by retail speculation?

However, there are different opinions in the market about Tesla's nine consecutive gains.

For example, AB Bernstein's stock analyst Toni Sacconaghi believes that Tesla's stock price may continue to rise for a period of time, but to be honest, this is like the previous meme stock frenzy, driven by retail investors' irrational speculation on stock prices, because Tesla's valuation is disconnected from its fundamentals.

Sacconaghi's remarks immediately sparked a wave of discussions on social media.

"This is a FOMO (fear of missing out) game between institutions and retail investors."

"The enthusiasm of retail investors is also one of the fundamental factors. When the meme economy is strong, Tesla will also strengthen."

"What kind of meme stock has factories in multiple countries? And does business with leaders of various countries? Isn't the entire stock market about hope for the future? Aren't all forecasts and spreadsheets just fancy guesses?"

From these comments, it can be seen that many people are still very optimistic about Tesla's future.

Currently, both profit expectations and car delivery volumes are related to Tesla's automotive business. To further boost Tesla's stock price in the future, stable development in the artificial intelligence business is needed, which can bring more hope to Tesla shareholders.

Wedbush analyst Dan Ives stated that Tesla is the most undervalued artificial intelligence company in the market, and the value of Tesla's AI business could increase by $1 trillion in the future. If the robotaxi event on August 8th is successful on a large scale, it may further drive the stock price up