Model 3 underestimated
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Tesla shares on the rise after analyst dubs Model 3 “underestimated”

Source: Teslarati

Ben Kallo, an analyst with Wall Street firm Baird, has raised Tesla’s (TSLA) price target to $411 citing the Model 3’s impact as “underestimated.”

“We expect strong demand for the Model 3 and believe the total addressable market will likely be underestimated, but think it will be an ongoing process to ascertain global demand,” Kallo wrote in a note Monday. “Tesla remains one of our top picks for 2017 and we are raising our price target as we continue to believe a successful Model 3 launch will be an inflection point for the stock.”

Kallo’s $411 price target is a significant jump from his previous price target of $368 for the EV company, representing a 15 percent increase.



Additionally, Kallo cited Tesla’s figures that net orders for the Model 3 have increased to a rate of 1,800 per day since the Model 3 delivery event in late July.

“We continue to believe Tesla Energy may be underappreciated by investors, and think the segment could be as important as the auto business over the long term,” Kallo wrote.

TSLA opened at $365, up 2 percent from Friday’s $357.72.

The Model 3 has had an undeniable effect on the company’s stocks throughout the summer.

The stock plummeted nearly 20 percent after the Elon Musk company missed the mark on its Q2 delivery target, leading analysts to question if the affordable Model 3 was knocking down sales of the higher-priced Model X and S.

The week of the event, the stock started low at $330.23, but had a steady increase, peaking at the Tuesday July 25 opening bell at $345.13. It declined after that high, and for that Wednesday, stock ebbed and flowed with no noticeable spikes or declines. The stock came in to that Thursday’s opening bell at $346.10, one day before the delivery event.

Kallo has previously been bullish on Tesla, calling it a “top pick for 2017” after the company’s second quarter earnings report. His praise helped the company hit $346.50, a jump from the prior day’s closing in the mid-320s.

CNBC first reported the news of Kallo’s upgraded price target.

Tesla shares on the rise after analyst dubs Model 3 “underestimated”

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