Tesla (NASDAQ:TSLA) stock is climbing higher on Friday as analysts start to change their tone about the electric vehicle (EV) company’s price cuts.
It looks like analyst sentiment has shifted, as some believe Tesla could now see increased demand for its EVs. This comes after the company announced a series of price cuts around the world to remain competitive.
In fact, data already suggests that demand for Tesla EVs is increasing. That includes the Model Y, which Piper Sandler analyst Alexander Potter reported is seeing an uptick in demand from customers.
What the Price Cuts Mean for TSLA Stock
In a time when inflation is weighing on consumers, reducing prices could attract new customers. In fact, several other car companies are following Tesla’s trend in order to regain interest in their vehicles.
The real question is, how much that will matter? Cathie Wood, a supporter of Tesla, believes rivals won’t be able to keep up with the company’s price cuts. If that turns out to be true, it could be a major boon to TSLA stock in the coming year.
As for trading activity today, TSLA has seen some 100 million shares change hands as of this writing. That’s a decent amount of trading but still below the company’s daily average trading volume of 147 million shares.
TSLA stock is up 4.7% as of Friday morning.
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On the date of publication, William White did not hold (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.