Tesla (NASDAQ: TSLA) stock sees strong bullish momentum in Friday trading. The electric vehicle (EV) the company's share price was up 6.9% at 3:15 pm ET amid a backdrop of a 1.2% gain for the S&P 500 index and gain 1.7% for the Nasdaq Composite index.
In addition to bullish momentum for the broader market today, Tesla is gaining ground thanks to positive industry reports and analyst coverage. In addition to a Reuters report stating that the EV specialist is seeing strong sales in China, the company's stock is also getting a boost from Canaccord's price target increase.
Reuters recently published a report on Tesla's sales performance in China across 2024, and the analysis paints a bullish picture. Vehicle sales in China increased by 8.8% year on year to reach more than 657,000. Even better, the report shows that vehicle sales accelerated above that rate to achieve growth of 12.8% and sales of 83,000 units last month. The results look especially significant on the heels of Tesla's recent vehicle deliveries and production report for the fourth quarter of 2024.
Tesla's Q4 update announced that the company produced 459,000 vehicles and delivered 495,000 vehicles in the period. Although the performance was not as bad as more recent projections had predicted, the results still came in below the average analyst estimate. The performance brought the company's total deliveries across 2024 to 1.79 million vehicles, below Wall Street's average forecast for deliveries of 1.806 million vehicles. Tesla's deliveries in 2024 fell short of the roughly 1.8 million vehicles delivered in 2023, marking the first time the company has seen an overall decline in unit sales. With total supplies falling short of expectations, signs of momentum in China are very evident.
In a note issued before the market opened today, Canaccord maintained a buy rating on Tesla and raised its one-year price target on the stock from $298 per share to $404 per share. Following gains for the stock today, the new price target actually suggests a downside of around 0.4%.
Canaccord analysts think Tesla's business fundamentals justify valuation multiples that are in the same range as other megacap tech peers including Nvidia, An applea Amazon. More importantly, the company thinks Tesla is positioned to take advantage of multiple “national” growth opportunities in categories including self-driving vehicles, batteries and robotics. So, while Tesla's one-year price target suggests it has an upside at the time of publication and has already been exceeded, Canaccord thinks the EV leader has a long-term winner.