Due to a broad sell off in tech, Tesla Inc (NASDAQ:TSLA) stock recently dropped below $300 for the first time in several months. That was a wonderful buying opportunity. Alongside other big tech names, TSLA stock has come back in favor. It has rebounded to over $320. But this recent rally isn’t the best selling opportunity.

Why? Because a 7% rally is nothing for a big-cap tech stock with a secular growth narrative of unmatched potential. TSLA is doing everything to be the transportation company of the future, from manufacturing electric vehicles to pioneering research in autonomous driving. Consequently, the potential returns on TSLA stock are far, far greater than just 7%.

Bull Beats Bear When It Comes to TSLA Stock

The bear thesis on TSLA is pretty straightforward. It is a money-losing operation that keeps pushing off the prospect of sustained profitability. It is a car company that is trading at nearly five-times sales (other major car companies trade well under 1-times sales). Competition is coming in a big way.

The whole EV industry is threatened by federal EV tax credits potentially getting cut in the U.S. (look at what happened to EV sales in Georgia when that state cut its $5,000 EV tax credit in June 2015). And, of course, bears are quick to point out that Model 3 ramp-up is disappointingly slow, but this thesis seems unnecessarily narrow and short-sighted.

Firstly, all big growth companies are money-losing operations. TSLA is a big growth company (70% sales growth expected over the next several years), so a lack of profitability isn’t exactly a red flag. Gross margins are consistently above 20%, a healthy mark for the auto industry.

So long as TSLA can maintain this 20%-plus gross margin (they should be able to given Model 3 gross margins are expected to hit 25%), robust revenue growth should drive big operating expense leverage. Huge operating expense leverage is what turns big-growth, big-loss companies into big-growth, big-profit companies.

Secondly, the sales multiple is big, but not unwarranted. As stated earlier, TSLA is looking at 70% sales growth over the next several years. Ford Motor Company (NYSE:F) is looking at essentially 1% sales growth over the next several years, while General Motors Company (NYSE:GM) is looking at sales declines over the next several years.

Considering its robust growth potential, TSLA stock should trade at a massive premium to other auto players.

Thirdly, competition is coming, but TSLA remains the king of the EV industry. Regardless of how many competitors enter the market, Tesla is still the name-brand for electric vehicles. When you think of EVs, you think of Tesla. That is why Model 3 reservations were running around 1,800 per day not too long ago.

So long as Tesla continues to innovate and produce quality EVs, this will remain true and provide a solid moat against rising competition.

Fourthly, EV tax credits have survived the political chopping block for now. The U.S. Senate tax reform bill has the $7,500 EV tax credit intact. While it is possible that the tax credit still gets axed through the remainder of the legislative process, it is promising for the EV industry that it hasn’t been killed just yet.

Lastly, while Model 3 ramp-up has been slow, so were Model X and Model S. Alongside the Model 3, both the Model X and Model S have had sub-300 vehicle delivery quarters. But quarterly delivery numbers for the Model X and Model S now both exceed 10,000. The Model 3 will follow a similar trajectory.

Because of this production ramp dynamic, it still is fairly likely that TSLA ramps up Model 3 production to 10,000 vehicles per week at some point in 2018. If that does happen, TSLA stock could shoot up to $400 rather quickly.

Bottom Line on TSLA Stock

When it comes to TSLA stock, bull beats bear. And the bull thesis is only getting more firepower.

TSLA’s new electric semi-truck has launched to broad demand, with pre-orders having already rolled in from Wal-Mart Stores Inc (NYSE:WMT), Anheuser Busch Inbev NV (ADR) (NYSE:BUD), and SYSCO Corporation (NYSE:SYS), among others.

All in all, there remains little reasons to sell TSLA stock after this mini 7% rally. This is a stock you hold for much bigger gains in the long term.

As of this writing, Luke Lango was long TSLA.