Investor's Corner

Tesla (TSLA) gets fresh ‘Buy’ rating, and it has nothing to do with its S&P 500 inclusion

(Credit: Anton Watts via Instagram)

Tesla stock (NASDAQ:TSLA) may be experiencing some pullback following its formal inclusion into the S&P 500 on Monday, but a Wall Street analyst has noted that he is now more bullish on the electric car maker than ever. Interestingly enough, the analyst’s bullish stance has everything to do with Tesla and its future potential, and nothing about its inclusion into the S&P 500. 

In a recent note, JMP Securities analyst Joseph Osha raised his price target for TSLA stock by 53% to $788 per share. He also reiterated his market “Outperform” rating—the equivalent of a “Buy”—which he has had on TSLA since October . Osha’s new price target puts him together with some of the most notable TSLA bulls in the street. 

Nowhere in Osha’s recent note did he mention Tesla’s S&P 500 inclusion, which also has the potential to bring some upside to the company. Instead, Osha remarked that he based his investment position on the idea that he needs to look a “few years out” to have a reasonable idea about what Tesla could become. 

“As we have watched the company evolve over the past six months, our 2.5 million unit delivery target for 2025 has looked increasingly plausible. Now, as we exit the year, and we review [Tesla’s] competitive position, both the market opportunity and Tesla’s potential shipments are looking larger than we thought,” Osha wrote, later noting that he has raised his 2025 delivery target to 3.05 million vehicles. 

Osha’s $788 price target for TSLA lies far above his peers on the street. So far, Osha’s target is 83.8% higher than the recent average analyst rating, which stands at $428.77 per share. 

Tesla has so far surged over 600% in 2020. In comparison, the S&P 500 has gained 14.2% in the same period. 

Disclaimer: I am long TSLA.

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Tesla (TSLA) gets fresh ‘Buy’ rating, and it has nothing to do with its S&P 500 inclusion
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