Tesla Inc (NASDAQ:TSLA) alone could grab half of the $5-trillion electric vehicle market opportunity in the coming years and leave more than 100 automakers fighting for the rest of the pie, according to Wedbush Securities.
The Tesla Analyst: Wedbush analyst Daniel Ives has maintained an Outperform rating and raised the price target to $1,400 a share from $1,100.
The Tesla Thesis: Ives, who has been a longtime Tesla bull, said in a note he expects the Elon Musk-led Tesla to benefit immensely from the continued and massive transformation coming as the entire auto industry eventually goes electric.
We believe there is $5 trillion of EV auto market dollars up for grabs with Tesla likely to own $2.5 trillion of this pie. We estimate China is worth $400 per share to the Tesla story for 2022 and raising our price target from $1,100 to $1,400 with our bull case $1,800.
— Daniel Ives (@DivesTech) November 19, 2021
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Ives said Tesla is leading the way. The entire ecosystem is set to benefit, including legacy stalwarts such as General Motors Co (NYSE:GM), Ford Motor Co (NYSE:F), Volkswagen Group (OTC:VWAGY) and EV-focused vendors such as Lucid Group Inc (NASDAQ:LCID), Rivian Automotive Inc (NASDAQ:RIVN), Fisker Inc (NYSE:FSR), the analyst said.
“In our opinion based on the current trajectory EVs globally will represent 10% of autos by 2025 and 30% by 2030,” he said.
Ives said China could represent 40% of Tesla’s deliveries next year, staging a comeback in the world’s largest auto market, where Tesla is heading “into year-end with a ~50k monthly run-rate for China into 2022.”
See Also: GM Has Potential To Trade At Multiples Similar To Tesla, Wedbush Says As It Initiates Coverage With 'Outperform' Rating
“We estimate the China story is worth $400 per share to the Tesla story for 2022.”
Ives On Legacy Rivals: Ives said traditional auto stalwarts such as GM, Ford and VW are due for a re-rating and estimated GM could be a $100 stock by the end of 2022.