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Analyst Blog

Shares of Tesla Motors, Inc. (TSLA - Analyst Report) surged 19.1% to $259.20 on Feb 25, outstripping the $250 mark for the first time, before closing lower at $248. What is worth noting is that the stock hit $250 in less than 15 days after it first crossed the $200 mark on Feb 11.

The upsurge in Tesla’s share price was driven by an increase in the target price by a Morgan Stanley (MS - Analyst Report) analyst and the top rank provided by Consumer Reports. The stock was already riding strong on the positive momentum provided by the fourth-quarter earnings last week.

Tesla logged adjusted income (including stock-based compensation expenses) of 13 cents per share in the fourth quarter of 2013, rebounding from a loss of 78 cents per share recorded in the year-ago quarter. This compared favorably with the Zacks Consensus Estimate of 4 cents.

Tesla is also expected to provide details regarding its planned Gigafactory this week, which is acting as a positive momentum to the stock. Further thrust was provided by Morgan Stanley analyst, Adam Jonas, who raised the electric carmaker’s target price to a minimum of $320 on its potential to nearly double its global automobile market share to 0.9% by 2028. In fact, the analyst expects Tesla to reach $500 per share if it becomes a leading player in both the automobile and power industries on the basis of its large-scale battery manufacturing plans.

Meanwhile, Consumer Reports named Model S the best car of 2014 in its survey of about 260 vehicles. It evaluates cars on the basis of over 50 tests along with reliability ratings provided by subscribers and scores earned by the cars in government and insurance industry crash tests.

Tesla designs and manufactures electric vehicles and electric vehicle powertrain components for partners like Toyota Motor Corp. (TM - Analyst Report) and Daimler AG (DDAIF). The automaker currently carries a Zacks Rank #1 (Strong Buy).

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