NEW YORK (TheStreet) -- Tesla Motors (TSLA) shares are up 1.6% to $257.94 on Tuesday after having coverage initiated with a "buy" rating and $320 price target by analysts at ISI Group.
Analysts at the firm believe that lithium ion batteries like the kind Tesla manufacturers and not hydrogen fuel cell batteries are the wave of the future for electric vehicles.
The firm believes that the company can sell 500,000 units by 2020 while expanding is global reach into China.
"We believe too much focus is placed on Tesla as a US electric car maker. In this report, we analyze Tesla in the context of the global industry and prevailing trends. Tesla is not exposed to the single largest threat to automotive returns, namely global emissions standards. As we show, conventional OEMs face headwinds of c$1,350 per unit. Yet, for Tesla costs will come down, with technology advances and scale," said the firm.
In separate news, Tesla won a court ruling in Massachusetts yesterday allowing it to employ its direct sales model in the state. The Street has more coverage of the ruling here.
Separately, TheStreet Ratings team rates TESLA MOTORS INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate TESLA MOTORS INC (TSLA) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and generally higher debt management risk."