Tesla's stock price has surged by 27.11% this week, easily wiping out all the declines from the first half of the year in just one week after entering the second half of the year. 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 fell to a low of $138.80.
After the first week of trading in the second half of 2024, Tesla bulls undoubtedly had a lot to be happy about - the stock price of this global electric car giant has not only risen for eight consecutive trading days, but also its return on investment this year has turned positive for the first time...
Market data shows that Tesla's stock price has surged by 27.11% this week - it only took one week after entering the second half of the year to easily erase all the declines in the first half of the year. Tesla closed at $251.55 on Friday. At the end of last year, the stock closed at $248.48, and in April this year, it once fell to a low of $138.80.
If we count the 'eight consecutive rise' since last Tuesday (June 25), Tesla stock has accumulated a 38% increase during this period, and its market value has surged by $220 billion.
This has directly helped Musk return to and sit firmly on the throne of the world's richest man. According to the Bloomberg Billionaires Index, Musk's net worth had reached $256 billion after Friday's close, about $35 billion more than the second-ranked Bezos.
Many positive factors are emerging.
For the reason behind Tesla's recent sharp rebound, many industry insiders will undoubtedly think of its delivery data in the second quarter that exceeded expectations.
Tesla's Q2 car delivery data, which was announced on Tuesday, was significantly better than Q1 and formed a sharp contrast to the most pessimistic forecast. Despite the market's continuous downward revisions of its expectations of Tesla, the company's actual delivery data only slipped at a relatively modest pace - reaching 443,956 units, while the previous industry forecast was for 0.436 million units. This has clearly calmed many investors' concerns.
"Tesla's worst period is now behind us, and we believe the demand story for electric vehicles has returned to this disruptive technology giant," Wedbush Securities technology analyst Dan Ives wrote on Wednesday this week.
Ives has already raised Tesla's target price to $300 from $275 and reiterated its 'outperform' rating. It is worth mentioning that Ives had previously described Tesla's Q1 delivery as a 'nightmare' and a 'complete disaster', but after better than expected delivery in Q2, Ives began to believe that Tesla has regained market confidence in its growth narrative.
In fact, the favorable factors recently gained by Tesla are not limited to delivery data alone. On July 5, the official WeChat account of Lingang New District Investment Promotion Service Center in Shanghai revealed that several state-owned enterprises in Lingang New District, including Chengtou Xingang Group and Lingang Investment Holding Group, have purchased Model Y vehicles as enterprise service cars.
In recent months, Tesla's market share of pure electric vehicles in China has remained around 10%. According to data from the China Association of Automobile Manufacturers, Tesla's Shanghai super factory delivered 71,007 cars in June, and domestic sales increased by 7% month-on-month to 59,261 units. Domestic sales in Q2 rose 10.2% month-on-month.
In addition to its traditional electric vehicle business, Tesla's solar and energy storage business has also made new breakthroughs in Q2. Tesla Energy, a subsidiary of Tesla, released data earlier this week showing that it deployed 9.4 GWh of battery storage products in Q2 2024, setting a quarterly record high, with a quarter-on-quarter growth of 129% and a year-on-year growth of 157%, which is an astonishing growth pace.
Morgan Stanley strategists stated in a recent report that higher energy storage sales are a 'headline-stealing' update, as it indicates that Tesla can benefit from the rising trend of energy demand brought about by the AI boom. As the new generation of artificial intelligence accelerates the growth of energy demand, power generation, and investment in data centers, we believe investors will begin to focus more on Tesla Energy.
However, despite Tesla's stock price taking a rocket-like leap in the past few trading days, its performance this year still lags 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, after filling the 'gap' in the first half of this year, Tesla has only risen by 1.2%.
Of course, even though Tesla's stock price has skyrocketed in the past few trading days, its performance this year still lags far behind the US stock market. The Nasdaq Composite Index has risen 22% in 2024, and the S&P 500 Index has also risen 17%. In comparison, after filling the gap in the first half of the year, Tesla has only risen 1.2% at present.
Technically, since early May, Tesla's stock price has been trading in a fairly narrow range. Now, it has finally broken through - the stock has risen above the 200-day moving average, which is a long-term trend indicator closely watched by traders. However, it is certain that at least one technical indicator shows that the risk of a pullback may also be imminent - in recent days, Tesla's stock price rebound pushed its relative strength index (RSI) to over 80, deep into the traditional overbought zone.
In Wall Street, some industry insiders still have doubts about Tesla's prospects. Ronald Jewsikow, a Guggenheim analyst, has maintained his bearish stance this week, even after Tesla reported optimistic delivery data.
Jewsikow said the electric car company delivered about 444,000 cars in the second quarter, higher than market expectations of 437,000 cars, constituting a "big surprise." Despite this, he still believes there are reasons to be cautious because Tesla's performance in the second quarter may mean that the situation will become more difficult going forward.
Jewsikow pointed out, "It is clear that promotional activities for Model Y and Model 3 have driven considerable sales growth, but as we have seen in other significant price reductions and discount activities, demand has been pulled forward, and new demand must be created in the third quarter and beyond, which has proven difficult over the past 18 months."
Looking ahead, Tesla's gross profit data for its cars may become a major focus for the outside world when it announces its second-quarter earnings after the close on July 23.
Apart from the upcoming financial report, analysts at Cantor Fitzgerald wrote in a report this week that they expect Tesla's upcoming event, "Robotaxi Day," in early next month, will also be a key factor in whether Tesla's stock price can get a new boost.
In April of this year, Musk claimed on the X platform that Tesla will announce a related "fully automated driving vehicle" product, a self-driving taxi (Robotaxi), on August 8. Cantor Fitzgerald analysts said, "We do not expect this segment to be launched before 2027, but we do expect it to be a meaningful business area for the company in the long run."
Currently, industry insiders are generally expecting that they will be able to get a glimpse of the truth on Robotaxi Day - to understand how Tesla charges, and how far Tesla is from "true autonomous driving." Ives noted in his Friday report that "the key to Tesla's stock prospects is whether Wall Street can realize that 'Tesla is the most underestimated AI company.' Musk and Tesla will usher in a historic Robotaxi Day on August 8, laying the groundwork for the future of FSD and autonomous driving."