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Tesla stock trends

Tesla, Inc., formerly known as Tesla Motors, designs, develops, manufactures and sells fully electric vehicles and energy systems. It is one of the fastest-growing companies in the world with innovative and high solutions for the future of the automobile industry. Now let’s take a closer look at the financial performance of the company and see how its stock performs.


The Highest Stock Price has been recorded in 2020

On February 3, 2020, Tesla stock hit a new highest closing price, gaining over $100 and finishing the day at $780 per share. Monday’s highest closing price can be explained with previous Argus Research raising the price target for Tesla from $556 to $808. The reason behind such an increase is explained by reliable historical financial results in the last quarter of 2019. Another factor for the rise is the increase in the sales volume of vehicles. According to Tesla’s fourth quarter’s findings in 2019, the business analysts predict that the sales in 2020 would exceed 500,000 cars, from 2019’s result of 367,500 sales volume.

Generally, while analyzing the past five-year performance of Tesla’s stock trend, the highest closing prices were accounted for in 2020. The lowest closing stock price was in February 2016, shortly after which, at the end of the month, stock value increased to $191.93. TSLA stock price used be slightly volatile from 2017 to 2018, but the average closing price at the end of the day was $315.05 in 2017 and $317.3 in 2018. Moving forward, in 2019 the average closing price of TESLA stock fell to $273.5, with the lowest result of the year in June at the amount of $178.97 and the highest at the end of December (when the company started having outstanding financial results for the year-end) at the amount of $430.94. For the start of 2020, the company already did a great job and had exceptional results for their stock value. If you take a closer look at the table below, you can notice the upward trending stock value, which was never this high considering the five-year historical performance of the stock.

The lowest result the company had at the beginning of 2020 was $430.26 in January, the highest stock value that surprised the whole stock market was on February 4 with an outstanding amount of $968. However, the next day the price went all the way back to $734 coming closer to its level on February 3.
Based on the performance of TSLA stock, let’s see what thoughts and expectations analysts have about its further performance.

What is expected?

According to a recent probability matrix model developed by ARK invest, the expected value of Tesla stock is going to be $7,000 by 2024. The ARK invest has arrived at this number by considering 2 case scenarios of Bear and Bull. In Bear’s case the estimations show that there is a 25% probability that TESLA stock price is going to be up to $1,500. In Bull’s case, there is a 25% chance that the stock price may be at least $15,000 by 2024. 

These estimates are based on three key factors, which are gross margins, capital efficiency, and autonomous capability. Now, let’s understand what three of these factors mean. First of all, the gross margin of Tesla shows the portion of each dollar of sales revenue that the company retains as gross profit. Capital efficiency, on the other hand, shows Tesla’s cost per unit to build new production capacity. And lastly, autonomous capability shows whether Tesla can launch a standalone taxi service successfully. For each of the scenarios, different probability factors were taken into consideration leading to the results mentioned above.

 

February 6, 2020

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