We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ETFs to Buy as Tesla Tops Toyota & Still Has Room to Run
Read MoreHide Full Article
Tesla (TSLA - Free Report) has been crowned the world’s most-valuable automaker – beating Toyota (TM - Free Report) – as its stock has crossed the $1,000 a share mark. Tesla now sits on a market cap of $190.01 billion while Toyota’s market cap is now more than $182 billion. Tesla’s shares rallied about 9% on Jun 10.
Behind the Gains
Wedbush Securities analyst Dan Ives said he thinks it still has "room to run further" even after the stock reached his base-case price target to $1,000 per share from $800. His bull-case target surged to $1,500 from $1,350. China’s high demand would be instrumental in driving Tesla’s shares higher. Model 3 sales remain "a ray of shining light,” per the analyst.
According to the China Passenger Car Association, Tesla sold 11,095 of its made-in-Shanghai Model 3 electric sedans to China-based customers in May, more than triple the volume recorded in April, per Reuters. This shows that the COVID-19 impact on Tesla sales has been receding.
In 2019, Tesla amassed considerable government support to set up its Shanghai car factory. Local banks invested $1.6 billion in the manufacturing facility, Chinese authorities helped Tesla in securing permits to acquire the land seamlessly, and allowed it to operate the factory independently, without a local joint venture, Reuters noted.
With production ramping up and the China government helping Tesla by donating PPE products, Tesla’s Shanghai factory should report healthy production in the near term. The factory is on target to produce 150,000 vehicles this year.
Apart from the upbeat sales figure from China, there are other tailwinds for the stock. Chief Executive of Tesla Elon Musk told his staff to boost production of the Tesla Semi commercial truck. Investors also are anticipating that Musk will reveal the new “million-mile” battery technology that could deliver longer life, lower costs and better range, per Reuters.
The rollout of the new game-changing batteries will give Tesla an edge over other carmakers as many have started to dip their toes in electric vehicle production of late.
ETFs in Focus
Tesla currently has a Zacks Rank #1 (Strong Buy) and Growth Score of C. Investors intending to tap the latest rally in the stock may tap the following ETFs.
MicroSectors FANG+ ETN (FNGS - Free Report) — Tesla accounts for about 12% share.
ARK Web x.0 ETF (ARKW - Free Report) — The fund holds 41 stocks in its basket, with Tesla occupying the top position at 10%.
ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) — Tesla occupies the top spot with more than 10% share.
First Trust NASDAQ Global Auto ETF (CARZ - Free Report) — The fund invests more than 10% weight in Tesla.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ETFs to Buy as Tesla Tops Toyota & Still Has Room to Run
Tesla (TSLA - Free Report) has been crowned the world’s most-valuable automaker – beating Toyota (TM - Free Report) – as its stock has crossed the $1,000 a share mark. Tesla now sits on a market cap of $190.01 billion while Toyota’s market cap is now more than $182 billion. Tesla’s shares rallied about 9% on Jun 10.
Behind the Gains
Wedbush Securities analyst Dan Ives said he thinks it still has "room to run further" even after the stock reached his base-case price target to $1,000 per share from $800. His bull-case target surged to $1,500 from $1,350. China’s high demand would be instrumental in driving Tesla’s shares higher. Model 3 sales remain "a ray of shining light,” per the analyst.
According to the China Passenger Car Association, Tesla sold 11,095 of its made-in-Shanghai Model 3 electric sedans to China-based customers in May, more than triple the volume recorded in April, per Reuters. This shows that the COVID-19 impact on Tesla sales has been receding.
In 2019, Tesla amassed considerable government support to set up its Shanghai car factory. Local banks invested $1.6 billion in the manufacturing facility, Chinese authorities helped Tesla in securing permits to acquire the land seamlessly, and allowed it to operate the factory independently, without a local joint venture, Reuters noted.
With production ramping up and the China government helping Tesla by donating PPE products, Tesla’s Shanghai factory should report healthy production in the near term. The factory is on target to produce 150,000 vehicles this year.
Apart from the upbeat sales figure from China, there are other tailwinds for the stock. Chief Executive of Tesla Elon Musk told his staff to boost production of the Tesla Semi commercial truck. Investors also are anticipating that Musk will reveal the new “million-mile” battery technology that could deliver longer life, lower costs and better range, per Reuters.
The rollout of the new game-changing batteries will give Tesla an edge over other carmakers as many have started to dip their toes in electric vehicle production of late.
ETFs in Focus
Tesla currently has a Zacks Rank #1 (Strong Buy) and Growth Score of C. Investors intending to tap the latest rally in the stock may tap the following ETFs.
MicroSectors FANG+ ETN (FNGS - Free Report) — Tesla accounts for about 12% share.
ARK Web x.0 ETF (ARKW - Free Report) — The fund holds 41 stocks in its basket, with Tesla occupying the top position at 10%.
ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) — Tesla occupies the top spot with more than 10% share.
First Trust NASDAQ Global Auto ETF (CARZ - Free Report) — The fund invests more than 10% weight in Tesla.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free>>