Eight consecutive gains, a 27% increase in a single week! Tesla wiped out half a year's decline in just one week

Tesla has regained its former momentum! Due to sales exceeding expectations in the first quarter, Tesla's stock price surged by 27% this week, easily erasing the decline of the past six months, sweeping away the market's low sentiment.

Tesla's second-quarter car delivery volume decreased by nearly 5% year-on-year, marking a decline for two consecutive quarters. However, this result exceeded Wall Street's expectations. With the delivery volume in the second quarter, Tesla retained its position as the global leader in electric vehicle sales.

Driven by the continuous catalysis of second-quarter delivery data, Tesla's stock price rose by 2.1% to $251.52 on Friday, with a 27% increase for the week, and a staggering 38% surge over the past eight trading days, setting a record for the longest upward trend in over a year.

This round of increase also brought Tesla's stock price back to its level in 2024, after hitting a 52-week low in April.

"The worst period for Tesla is over, we believe the electric vehicle demand story is returning to this disruptive tech giant," wrote Dan Ives, a technology analyst at Wedbush Securities on Wednesday. He raised Tesla's target price from $275 to $300 and reiterated an "outperform" rating.

From Ridicule to Exemplar, Tesla Delivers Good Results at a Critical Moment

A few months ago, Tesla was the laughingstock of Wall Street.

Due to frequent significant price cuts, weakening car gross margins, and cooling demand for electric vehicles, Tesla saw its first year-on-year decline in deliveries since 2020 in the first quarter. Coupled with increasingly fierce competition in key markets, Tesla's stock price plummeted. To reduce expenses, Tesla also carried out a massive layoff.

At that time, quoting Bank of America, Tesla was a growth stock without growth.

Tesla lagged behind the other 499 stocks in the S&P 500 index, including scandal-plagued Boeing. Some began to question whether Tesla still deserved to be among the "Big Seven" stocks.

Ives once described Tesla's first-quarter deliveries as a "nightmare" and a "complete disaster." After exceeding Wall Street's expectations in the second quarter, Ives began to believe that Tesla had regained market confidence in its growth narrative.

This was a significant counterattack by Tesla and Musk in the second quarter. Wall Street originally expected a significant decline this quarter, with global electric vehicle demand still fluctuating. However, Tesla delivered strong sales performance at a crucial moment for investors After more than two months of consolidation around $180, the bulls now see the potential for further upside in Tesla's stock price.

On one hand, with a significant increase in trading volume, Tesla's stock price has successfully broken above the 200-day moving average. The current trend indicates that Tesla's stock may be on the verge of ending a three-year downtrend.

Can the uptrend continue? The next month is crucial

Despite better-than-expected deliveries in the second quarter, Tesla still faces challenges.

Tesla is developing affordable electric vehicle models to attract price-sensitive buyers, while also further investing in autonomous driving technology and humanoid robots.

The second-quarter earnings report released on July 23 may provide investors with an initial understanding of Tesla's progress in new products. In addition, the automotive gross margin may also be a focus of attention.

Musk also plans to host an event called Robotaxi Day on August 8, unveiling the Robotaxi robot taxi for the first time.

In response, analysts at Cantor Fitzgerald wrote in a report on Tuesday, "This event is expected to be a significant catalyst for Tesla's stock price."

"Although we do not expect this business segment to be launched until 2027, we do anticipate that in the long term, it will become an important business segment for the company."

Cantor Fitzgerald expects Tesla's car deliveries this year to be lower than last year. The company has a target price of $230 for Tesla and a "Buy" rating.

It is worth noting that while Tesla's stock price has rebounded significantly, its performance this year lags behind the broader market. Year-to-date, the Nasdaq has risen by 24%, the S&P 500 has risen by 17%, while Tesla has only risen by 1.3%.

Furthermore, a recent Axios Harris poll found that Tesla's brand image is declining, partly due to Musk's "eccentric actions" and "political comments." A survey released by the media this week also indicated that Musk's "polarizing remarks" and "political activities" are driving away some "left-leaning consumers."