Tesla (TSLA) - Get Report scored a "major home run" Thursday when the electric vehicle maker posted strong-than-expected delivery results despite the coronavirus outbreak, according to a Wedbush analyst, who raised his bull case share price target for the electric vehicle maker to $2,000 and increased his overall price target from $1,000 to $1,250.
Analyst Dan Ives, who overall has a neutral rating on the stock, said in a note to clients that Tesla's stronger-than-expected second quarter delivery figures, which the company released Thursday, "we're well ahead of expectations given the bleak COVID economic backdrop in a performance we would characterize as a 'major home run' speaking to its Teflonlike business model."
Shares of the Palo Alto, Calif. company were up 9% to $1,225 in early trading on Thursday. Tesla became the world's largest automaker by market cap on Wednesday, surpassing Toyota.
TheStreet's Rob Maurer at Tesla Daily points out that Tesla stock increased as much as the entire price target of one analyst at GLJ Research.
Model 3 and Model Y deliveries hit 80,050 in the second quarter, Tesla said, while Model S and Model X deliveries were pegged at 10,600, for a total of 90,650. The company said earlier this year it would "comfortably" deliver 500,000 vehicles by the end of 2020, but that was before the coronavirus pandemic hit, shutting down Tesla factories.
"In our opinion, a 90k delivery number in this COVID lockdown environment is a jaw-dropper and the bulls will run with this as a potential paradigm changer moving ahead," Ives said. "China appeared to be the star of the show and was a major source of strength in 2Q based on our analysis and industry data."
Ives said that demand out of China for the company's Model 3 "remains a ray of shining light for Tesla in a dark global macro."
"We believe that the China growth story is worth at least $300 per share and $400 in a bull case to Tesla as this EV penetration is set to ramp significantly over the next 12 to 18 months, along with major battery innovations coming out of Giga 3 (million-mile battery remains an elusive goal now in the grasp in our opinion)," Ives said.