Shares of Tesla (NASDAQ:TSLA) stock have traded turbulently during the past month but are still up an impressive 115%-plus so far this year. However, the electric vehicle (EV) company received a price target reduction this morning from Jefferies analyst Philippe Houchois.
Houchois slashed his price target to $210 from $250, marking a 16% reduction. Most notably, the analyst stated that “cancelling Cybertruck would probably be positive for shares.” Instead, Houchois believes that Tesla should focus on high-volume market opportunities and production of its 4680 battery cell for the Model Y.
Deliveries of Tesla’s newest EV are set to begin on Nov. 30 and will be accompanied by a celebratory event at the company’s Gigafactory Texas in Austin, Texas.
TSLA Stock: Jefferies Reduces Price Target to $210
Houchois issued a downcast note for the next 12 to 18 months, saying that the company is “stuck in a slow lane.” The analyst also stated that the launch of less expensive EVs by legacy European original equipment manufacturers (OEMs) and competition from Chinese EV makers will also threaten Tesla’s stance as an industry leader.
“With 2024 already a lost year for growth, it would help Tesla refocus on an edge that was built on simplicity, scale and speed,” said Houchois. As a result, the analyst has reduced his post Q3 2023 and 2024 EBIT estimate by 15% to 24% to between $8.7 billion and $10.6 billion.
Houchois carries an impressive TipRanks rating and is ranked at 202 among 8,631 Wall Street analysts tracked by the website.
On the other side of the spectrum is Piper Sandler analyst Alexander Potter, who raised his price target for TSLA stock to $295 from $290 this morning. Potter adjusted his price target due to Tesla’s recent earnings, vehicle price changes and a lower weighted average cost of capital (WACC). Using the 10-year Treasury rate as a basis to WACC, Potter lowered the WACC for his discounted cash flow (DCF) model to 14% from 14.5%, which resulted in a higher price target.
Potter is also highly ranked on TipRanks, tallying in as the 314th best analyst tracked by the website.
On the date of publication, Eddie Pan 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.
