Tesla (TSLA) - Get Report on Friday received a big price-target boost from analysts at Credit Suisse, who doubled their one-year outlook for the electric carmaker’s stock to $1,400 from $700, though cautioned that Tesla shares at current levels are “priced to perfection.”
In a note to clients, Credit Suisse analysts Dan Levy and AJ Denham said they see “multiple factors responsible for the recent sharp run-up in Tesla stock,” including “EV euphoria” as well as short-sale covering and buying by quant/momentum investors.
However, with the stock "priced for perfection, we believe any material near-term negative datapoint could lead to a drawdown,” Levy and Denham cautioned.
Tesla shares have gained more than 250% year to date amid expectations that the carmaker will not only continue to hold pole position in the electric vehicle market but will streamline its operations and produce more profits.
Additional coming positives include Tesla’s so-called Battery Day, when the company will reveal a long-lasting battery, and second-quarter earnings that may show a profit, are also reasons to expect the stock to double over the next 12 months, Levy and Denham wrote.
While doubling their expectations, as the world's most valuable car brand, the analysts did note that Tesla still needs to show that it will be producing 2.2 million cars by 2025, putting it on par with German automakers.
"It tells us that the onus is now on Tesla to execute to these lofty expectations; albeit, an elevated stock price provides Tesla with a significant cost-of-capital advantage," the analysts said.
To be sure, other Wall Street analysts are also raising their one-year targets on Tesla, particularly as the company's shares continue to climb to new heights.
Rob Maurer of Tesla Daily reported earlier this week that Piper Sandler analyst Alex Potter raised his price target on Tesla by nearly 150% from $939 to $2,322 a share.
Shares of Tesla were up 0.51% at $1,508.30 in trading on Friday.