Tesla (NASDAQ:TSLA) continues to come out on top, even when Wall Street wants to knock it down. The electric vehicle leader has once again demonstrated its prowess this week in the face of bearish analyst reports. So what do you need to know about TSLA stock right now?
On Monday, Bernstein analyst Toni Sacconaghi reiterated his “sell” recommendation and his $300 price target. The analyst shared concerns around a slowdown in the full-self driving (FSD) software and delays in production of a $25,000 car.
However, investors learned again today that one analyst isn’t strong enough to drive down a company like Tesla. You should brush off Sacconaghi’s concerns and embrace TSLA stock as a winner.
What Is Happening With TSLA Stock
In his note, Sacconaghi expressed concern that Tesla wouldn’t be developing a more affordable electric vehicle in the near future. The decision “feels at odds with Tesla’s goal of driving EV adoption as quickly as possible,” he wrote.
The analyst is referring to CEO Elon Musk’s eyebrow-raising comments during the fourth-quarter earnings call. There, he shared that the automaker would not be prioritizing new models in 2022. Instead, Tesla would focus on scaling production of its current lineup. This decision stems, at least partially, from ongoing global supply chain issues.
While Sacconaghi sees the decision to not prioritize a $25,000 car before 2025 as a problem, Musk’s decision exemplifies what investors should like about Tesla. The EV maker made it through 2021 despite supply chain challenges, still posting record deliveries for Q4. Focusing on what it knows — and on what sells — in 2022 is a smart decision.
Beyond that, recent data reveal that Tesla is the most-searched car brand in the world. When consumers shop for electric vehicles, Tesla is still the first name they think of. That holds true despite its high prices.
Indeed, it will serve Tesla well to continue with its current business model and not cheapen its brand. Driving a Tesla is still considered a status symbol by many, giving it a competitive edge.
What Comes Next
The bottom line is that Tesla does not need to cheapen its name by producing more affordable cars, at least right now. A revolution in electric vehicles is underway, and the road ahead for Tesla looks smooth.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
