Huaxing Securities published a report stating that Tesla's (TSLA.US) second-quarter electric vehicle delivery and energy storage installation volume exceeded expectations. The company delivered 443,956 vehicles in the second quarter, a year-on-year decrease of 4.8% but a quarterly increase of 14.8%, with Model 3/Y accounting for 422,405 of the deliveries and the remaining 21,551 for other vehicle models, exceeding expectations of both Huaxing and the market.

Huaxing Securities believes that with the recovery of the sales volume of existing models and the release of new models next year, the fundamentals of Tesla's electric vehicle business are steadily improving. At the same time, driven by new products such as FSD, Robotaxi, and robots, Tesla's valuation is expected to continue to rise.

Huaxing Securities has raised its revenue estimates for Tesla for 2024-2026 by 6.5%, 5.8%, and 5.5%, respectively, to $102.31 billion, $122.67 billion, and $146.64 billion, with year-on-year declines of 5.7%, growth of 19.9%, and growth of 19.5%, respectively. The company also raised its Non-GAAP net profit estimates for 2024-2026 by 7.9%, 6.5%, and 5.9%, respectively, to $11.93 billion, $15.66 billion, and $19.61 billion, with year-on-year growth of 9.7%, 31.3%, and 25.2%, respectively.

In terms of valuation, considering the improvement in the company's electric vehicle sales volume, rapid FSD iteration, and the release of new models next year, the bank increased its forecast for Tesla's business price-to-earnings ratio valuation for 2024 to 90 times, up from the previous forecast of 50 times, but still below the average valuation of the company from 2021 to 2024, which is 111 times price-to-earnings ratio. At the same time, due to the significant growth of the company's energy storage business, the bank raised its valuation for the business in 2024 to a forecasted 10 times p/s, up from the previous forecast of 5 times p/s. The target price was raised from $151.31 to $282.13, with a "buy" rating.