After finishing the first week of trading in the second half of 2024, Tesla's bulls can undoubtedly be said to have gained a lot - the stock price of this global electric vehicle giant has not only risen for eight consecutive trading days, but also turned positive for the first time this year
Market data shows that Tesla's stock price has surged by 27.11% this week, making it easy to smooth out all the declines in the first half of the year in just one week after entering the second half. Tesla closed at $251.55 on Friday. At the end of last year, the stock closed at $248.48, and in April of this year, it briefly fell to a low of $138.80.
If we calculate from the eight consecutive positive days since last Tuesday (June 25th), Tesla's stock price has risen by 38% during this period, and its market value has surged by $220 billion.
This directly helped Musk return and secure his position as the world's richest man. According to the Bloomberg Billionaires Index, Musk's net worth reached $256 billion after the close of trading on Friday, about $35 billion higher than the second ranked Bezos.
Many favorable factors have struck
Many industry insiders undoubtedly think of Tesla's better than expected delivery data for the second quarter as the reason for its recent strong rebound.
Tesla's second quarter car delivery data released on Tuesday was significantly better than the first quarter and in sharp contrast to the most pessimistic forecast. Although the market's expectations for Tesla have been continuously lowered, the actual delivery data of the company has only declined at a relatively mild rate - reaching 443956 vehicles, compared to the industry's previous expectation of 436000 vehicles, which clearly calmed the concerns of many investors.
"Tesla's worst period has passed, and we believe the demand story for electric vehicles is beginning to return to this disruptive technology giant," Wedbush Securities technology analyst Dan Ives wrote on Wednesday this week.
Ives has currently raised Tesla's target price from $275 to $300 and reiterated its "better than the market" rating. It is worth mentioning that Ives previously described Tesla's first quarter delivery as a "nightmare" and "complete disaster", but after the second quarter delivery exceeded Wall Street's expectations, Ives began to believe that Tesla had regained market confidence in its growth narrative.
In fact, Tesla's recent gains are not limited to just delivering data. On July 5th, the official WeChat account of the "Lingang New Area Investment Promotion Service Center" in Shanghai revealed that several state-owned enterprises in the Lingang New Area, including Urban Investment Xinggang Group and Lingang Investment Control Group, have purchased Model Y as a functional vehicle for the enterprise.
In recent months, Tesla's market share of pure electric vehicles in China has been maintained at around 10%. According to data from the China Association of Automobile Manufacturers, Tesla's Shanghai super factory delivered 71007 vehicles in June, and domestic sales continued to increase to 59261 vehicles month on month, a 7% increase from the previous month. In the second quarter of this year, Tesla's domestic sales increased by 10.2% month on month.
In addition to its traditional electric vehicle business, Tesla's solar and energy storage businesses also saw new breakthroughs in the second quarter. Tesla Energy, a subsidiary of Tesla, released data earlier this week showing that it deployed 9.4GWh of battery energy storage products in the second quarter of 2024, setting a record for the highest quarter, with a quarter on quarter growth of 129% and a year-on-year growth of 157%, a staggering growth rate.
Morgan Stanley strategists have stated in their latest report that higher energy storage sales are a "catchy" update, as it indicates that Tesla can benefit from the rising energy demand brought about by the artificial intelligence boom. With the accelerated stimulation of energy demand, power generation, and data center investment by the new generation of artificial intelligence, it is believed that investors will begin to pay more attention to Tesla Energy.
There are still voices of doubt
Of course, despite Tesla's skyrocketing stock price in the past few trading days, its performance this year is still far behind that of the US stock market. The Nasdaq Composite Index has risen by 22% in 2024, and the S&P 500 Index has also risen by 17%. In contrast, Tesla has only risen by 1.2% after filling the gap in the first half of the year.
From a technical perspective, Tesla's stock price has been trading within a relatively narrow range since early May, and now it has finally broken through - the stock has risen above the 200 day moving average, which is a long-term trend indicator closely monitored by traders. However, it can be certain that at least one technical indicator suggests that the risk of a pullback may also be at hand - in recent days, the rebound in Tesla's stock price has pushed its relative strength index (RSI) to over 80, deepening the traditional overbought zone.
On Wall Street, some industry insiders still have doubts about Tesla's prospects. Guggenheim analyst Ronald Jewsikow has maintained his bearish stance this week, even after Tesla released optimistic delivery data.
Jewsikow stated that the electric vehicle company delivered approximately 444000 vehicles in the second quarter, exceeding the market average expectation of 437000 vehicles and creating a "significant surprise". However, he still believes there is reason to remain cautious, as Tesla's performance in the second quarter may mean that the situation ahead will be even more challenging.
Jewsikow pointed out, "It is clear that the promotional activities of Model Y and Model 3 have driven significant sales growth, but as we have seen in other significant price reductions and discount activities, demand has been driven ahead of schedule, and new demand must be created in the third quarter and beyond, which has been proven difficult over the past 18 months."
Looking ahead, Tesla will announce its second quarter results after the close on July 23rd. At that time, the gross profit data of its cars may become a major concern for the outside world.
In addition to the upcoming financial report, analysts from Cantor Fitzgerald wrote in a report this week that they expected that the large-scale event "Robotaxi Day" in Truss at the beginning of next month would also be the key to whether Tesla's share price could obtain a new rising engine.
In April of this year, Musk claimed on the X platform that Tesla would announce its "fully autonomous driving vehicle" product - the Robotaxi - on August 8th. Cantor Fitzgerald analyst said, "Although we do not expect this segment to be launched before 2027, we do expect it to be a meaningful business area for the company in the long run."
At present, industry insiders generally hope that when Robotaxi Day arrives, they can have a glimpse into Tesla's pricing system and how far Tesla is from truly autonomous driving. Ives pointed out in his report on Friday that "the key to Tesla's stock outlook is whether Wall Street can recognize that 'Tesla is the most undervalued AI company.' Musk and Tesla will usher in historic Robotaxi Day on August 8th, which will pave the way for FSD and autonomous driving in the future."