Tesla’s Stock Set to Extend Long Win Streak, Turns Green for First Time in 2024

Tesla Inc. shares experienced a volatile start but ultimately traded higher on Friday, continuing their longest winning streak in over a year. The stock’s upward momentum, which began on June 25, gained significant traction earlier in the week following unexpectedly strong second-quarter delivery figures.

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Tesla's stock (TSLA) rose 1% in morning trading, heading towards its highest close since December 28. It was on track to post its first year-to-date gain in 2024. Within the first hour of trading, the stock fluctuated, dropping as much as 1.6% and rising as much as 2.5%.

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The stock aimed for an eighth consecutive gain, its longest streak since a 13-day run ending on June 13, 2023. Over the current winning streak, Tesla's shares have soared 36.3%, marking its best eight-day performance since a 39.6% rise ending on November 1, 2021.

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With approximately 3.2 billion shares outstanding, Tesla’s current market capitalization is around $793.8 billion. This is a significant recovery from its 2024 low market cap of about $453 billion, recorded when the stock closed at a 15-month low of $142.05 on April 22.

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Wedbush analyst Dan Ives remains optimistic about Tesla’s future, setting a $300 price target for the stock, which suggests a 22% upside from current levels. Ives attributes his bullish outlook to Tesla’s upcoming robotaxi-focused event on August 8, which he believes will be a pivotal moment for the company, showcasing its full self-driving (FSD) ambitions.

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Ives also highlights the importance of artificial intelligence (AI) in Tesla’s vision for an autonomous future, noting that investors have yet to fully recognize Tesla as a major AI player. “The key for Tesla’s stock looking ahead is the [Wall] Street recognizing that Tesla is the most undervalued AI play in the market in our view, with a historical Robotaxi Day ahead for Musk and Tesla on August 8th that will lay the yellow brick road to FSD and an autonomous future,” Ives wrote in a note to clients.

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Analysts at TPH added in their Friday note that they expect consensus estimates for Tesla’s quarterly earnings to rise, driven by higher deliveries and energy storage projections. Tesla is scheduled to report second-quarter results on July 23 after the market closes.

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FactSet-polled analysts anticipate Tesla will report adjusted earnings of 60 cents per share on $24 billion in sales. This would compare to the previous year’s second-quarter results of adjusted earnings per share (EPS) of 91 cents on $24.9 billion in sales.

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TPH analysts are forecasting earnings of 75 cents per share, based on the assumption that increased energy storage volumes will significantly boost the company's bottom line. However, their expectations for 2024 deliveries are more conservative, predicting 1.74 million vehicles compared to the broader market’s estimate of around 2 million.

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The analysts cited limited room for organic growth in the Model 3/Y due to global market penetration and intense competition, particularly in China, where potential tariff changes could impact demand in the second half of the year. Instead, they project growth in the third and fourth quarters of 2024 will be driven by increasing Cybertruck volumes.

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Looking beyond earnings, TPH analysts believe the spotlight will shift to Tesla’s Robotaxi Day on August 8. They noted that to maintain momentum, Tesla would need to deliver several surprises, including unveiling a robotaxi prototype.

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In summary, Tesla’s recent stock performance and optimistic outlook from analysts suggest potential for continued growth. Despite some fluctuations and market challenges, key upcoming events such as the Robotaxi Day and strong earnings projections highlight Tesla’s strategic initiatives and technological advancements, reinforcing its position in the market.

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