Tesla Motors Inc (TSLA) Valuation ‘Justified’, Says Baird

Tesla stockBlomst / Pixabay

Tesla Motors Inc (TSLA) revelation on Friday helped to lower the concern among the investors, and may push the stock going forward, according to Ben Kallo, a senior research analyst at Robert W. Baird. On the day, the EV makers stock closed up 3% at $274.

Many catalysts for Tesla

Talking at a CNBC “Closing Bell,” Kallo said, “I think you bet on Elon Musk,” adding the company’s valuation is “justified.”

On Friday, Tesla announced an upgrade to the Model S line including a new battery, price point and speed options. This, according to Kallo, will ease the concerns over the cars driving range and affordability.

Kallo gave a price target of $335 to the stock, adding the Model S upgrades along with Musk’s comment over the Model X and Model 3 deliveries being on schedule, will push the shares up. The Model X, which is scheduled to come later this year, was referred to as “the next major catalyst” by Kallo.

Year to date, Tesla stock is up almost 24% while in the last 12 months, the shares are up almost 25%. The stock has a 53-week low of $181.40 and a 52-week high of $291.42.

Ratings from other analysts

Many analysts have come out with their verdict on the stock in recent weeks. Jefferies Group, in a research note on Friday, reiterated a Buy on the EV maker with a price target of $360. In a research note on July 12th, analysts at Global Equities Research reiterated a Buy on Tesla with a price target of $385. Vetr analysts raised the rating on the stock from Sell to Hold, with a price target of $260.79, in a note on July 8th. Robert W. Baird analysts, in a note on July 8, downgraded the stock on from an Accumulate rating to a Buy with a price target of $335. Pacific Crest analysts lowered the rating on the stock from Buy to Overweight, and set a price target of $293, in a note on July 8th. Presently, Tesla has consensus rating of Hold, and a consensus price target of $281.47

In separate news, Tesla VP Jerome M. Guillen sold 1,500 shares at an average price of $264.53 for a total transaction of $396,795, on Wednesday, July 15th. After the transaction, the VP now owns 2,662 shares valuing around $704,178.86, according to an SEC filing.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com

22 Comments on "Tesla Motors Inc (TSLA) Valuation ‘Justified’, Says Baird"

  1. OK… how’s this… due to the policies of my utility (My allowed Solar PV is based on consumption) more coal would have been burned if I DIDN’T drive and EV… so technically my Tesla uses NEGATIVE coal :D

  2. Funny. Say-it.

  3. So you “troll” these sites. You’re a pretty phart smeller… huh?

  4. It is not quite a peachy keen as you suggest. 1. Consider than when the sun is shining beating down and everybody’s AC is roaring, your shiny new Tesla is sitting in a parking lot at work doing nothing.

    2. Even if you could share power from your car, why would you? You want your range disappearing before you even get in your car to go home? And what about the wear and tear on your battery?

    No, Tesla cars are not backup for the grid. That is never going to fly.

    No one wants to hear it, but nuclear is by far the best solution to U.S. energy infrastructure. Windmills hack up birds including eagles and make a racket. Solar collectors fry passing birds in the air and take huge swaths of land. And neither does very well at giving you power when you need it. There are ways of dealing with that: pumped water storage, and I think big chunks of concrete on rails on a grade with regeneration which has been experimented with seem fine. But none of these really works if you go days or weeks without the sun or the wind. And if you are trying to heat a home in the dead of winter in the northern states, that is exactly when you don’t get much solar.

    Hydro electric is terrific, but there is too little of it. You are left with only 2 tried and tested methods of generation: fossil fuel and nuclear. Coal is a no go, oil is too expensive and would similarly be blocked. Protesters and legal pit bulls are now even trying to stop natural gas. True, they protest nuclear too, but many of the environmentalists are starting to see the value of nuclear: small footprint (meaning less environment taken over), base-load…and can adjust power output so it is suitable to replace coal and other fossil fuel. Besides not generating CO2, it does not release other toxins like lead, cadmium, mercury, and arsenic that coal pumps out causing all sorts of environmental damage and health damage. We might clean coal emissions from sulfur compounds, smoke, and soot, but nothing is done about the metals. And there is the ash…one of the most objectionable wastes there is. That stuff is radioactive, and destructive because of heavy metals and other nasties. Where do you put that, that will not harm the environment? Natural gas? Yep, not so bad…but there is still CO2.

    Most of the objections of nuclear have been exaggerated or can easily be mitigated by choice of location.

  5. I go where the trolls and nonsense are ;)

  6. LOL… my car has consumed ~23MWh over 72k miles. My PV system went on-line 2.5 years ago, same time I got my car and it’s produced ~43MWh. So mine certainly doesn’t. Many… perhaps most Tesla owners are smart enough to produce their own electricity too…

    http://www.teslamotorsclub.com/showthread.php/22197-Driving-on-Sunshine

    Coal generation in the US has fallen ~20% in 10 years… its days are numbered.

  7. Set down your bong put on some pants and crawl out of your mothers basement dude! You need air man… ya look like an old troll. Say Tesla cars do not run on coal.

  8. Why are YOU here? – you must be everywhere I am.

  9. iPhones are useless toys runnin’ on coal. Go nowhere machine.

    Flux Capacitor is the future…

  10. Tesla is more than a transportation company, but an energy company. Its employees believe in its mission which is nothing short of revolutionizing transportation and its relationship to energy use. As any investor worth their salt understands energy markets dwarf all others, internet, auto, defense, everything else. The USA elecyric grid will require $Ts in investment over the next 20 years, Tesla is positioned central to exploit these trends. For instance, all of these vehicle batteries networked into the grid will work hand in hand with distributed solar, allowing stabilization and use of renewable 24/7. Scale will be achieved by the Giga plant giving Tesla the ability to support 10s of GW of electric generation. Imagine the ability to bring a nuclear electric generation plant online every year. Distributed Solar quick charge stations, allow fill up in 10 minutes, if you didn’t charge at home or the office, will displace first coal then nat gas as carbon fees start to rollout. (Note situation with carbon is more drastic than people realize especially those in the west who have seen emissions stabilize and shrink. Asia, India, Brazil, Africa have all exponentially increased emissions. I’m fact since 1989, total carbon emissions have doubled, our current path puts us adding that much again in < 20 yrs. It's not being solved its being exasperata

  11. Wow ace…. you’re really making the troll circuit… let me guess…. some of that $1B lost shorting TSLA was yours?

  12. While we’re talking lawn equipment, battery-electric trimmers are already definitively better than gas trimmers. It’s taking a startlingly long time for people to realize this though.

    Also, snowblowers are the ‘last frontier’ of gasoline lawn equipment. IT’ll be 5-10 years.

    “Tesla has also showed itself slow to make new models. They will need to fix that going forward.”

    They’re going as fast as they possibly can. They have some problems incumbent carmakers do not have, such as building entire factories from scratch.

  13. I looked it up. That is true for most states. And probably all the states that are playing along with the dealers. But I can see people trying to get residency in another state and registering it there instead. And that is probably much easier if you bought the car in that state.

    But your objection stands. Tesla will probably need some other leverage to get these bogus laws changed.

    Hopefully they can get a bill passed by the Fed which invalidates these unethical laws, or maybe challenge it in the courts.

    Seems ludicrous to be forced to pay a tax on something you were not permitted to buy in that state, to that state.

  14. Mindbrkr. I disagree on a minor point, when a Model S is purchased out of state, the owner must register the Tesla in his/her home state and pay the relevant sales tax and other fees.

  15. Car dealers don’t like Tesla. And as we know, they will say anything. They even “Black Balled” Tesla from showing their car at any of the auto shows in North America. They are really frightened. They are also trying to block direct sales in a number of states.
    Anyone can see, that grip will not last. When the model 3 comes out, and tens or hundreds of thousands in their state want the cars and start buying in neighboring states, those states will see how much taxes they are loosing and reverse their laws.
    Dealers are used to maintenance schedule stuff, collecting free money, recall repairs, trade-in rip-offs, and middleman car price jack-ups. No one wants to be anywhere near these parasites, and if they had a choice, would dodge them. But as all parasites who know any other job they might get will pay them less…they defend their turf.
    People making money in oil and manufacturing internal combustion autos also spread their BS.
    It is absolutely clear that batteries will get better and cheaper, and it is not going to take 5 decades to get to 500+ miles. Almost certainly less than 10 years.
    Electric cars are easier to make requiring far less R and D. Engines and transmissions for internal combustion require enormous amounts of engineering. Electric motors do not. And transmissions for electrics are simple, or nonexistent.

    Consider lawn mowers. Electric corded mowers are the cheapest, gas is next, then battery-electrics. It is obvious that it is the battery that makes the battery-electrics expensive. When the battery becomes cheaper, it will be closer to the price of the corded mowers. The cord is the only thing holding those back from being in every yard. Fuel, maintenance, noise, short life, stink, starting problems, greasy, repair costs and dealing with greedy repair people…who wouldn’t go with something that did not have those liabilities?

    Cars are going electric, that is a fact. The only real question is, “Can Tesla soak-up market share and keep it?” It think we will know more when the Model 3 comes out. Tesla has also showed itself slow to make new models. They will need to fix that going forward. If you are the trail blazer, but you are strolling, you might not be the trailblazer for long.

  16. Agreed he’s a short and a liAr.

  17. It is highly satisfying to know that sleazy, hate-filled and dishonest people like you are voluntarily sacrificing their economic relevance in society by shorting this stock. Do you really think that throwing $100 bills on this fire is going to put it out? Good.

  18. Mds & AceDoubleDown had better think up some better excuses, Elon Musk sold and made more money when he sold PayPal than you both will ever make in your entire lifetimes.
    We know what your up to, you are making up stuff so tsla will go down and your short position will make money, but nobody will believe what your saying, so give it up and invest with your money, not your mouth.

  19. ?Where on Earth did you get that from? Lithium batteries are not especially toxic. Nor is it “ancient” technology. If it was, it wouldn’t be used in iPhones:P. Lithium batteries of various chemistries (there are many types) undergo constant improvements. A Li-ion battery you get in a phone you buy today is quite different than one that you got in a phone 5 years ago.

    Don’t make the mistake of assuming that no R&D is happening in Lithium batteries just because a name change hasn’t occurred. In fact, capacity in Lithium batteries is increasing by about 7-8% per year. That’s enormous and incredible when you think about it. That means the energy density of the Lithium batteries is doubling every ~10 years or so. And this isn’t counting potential breakthroughs, just bog standard R&D that everyone and their dog is doing.

  20. Tesla cars are useless toys runnin’ on coal.(can’t see it from my house) Already ancient lithium ion toxic battery dump/grid stress/storage device – Go nowhere machine.

  21. Cuz you’re a total lier? A BS spreader, and FUD sayer.
    Probably paid by GM to spread lies and misinformations.
    :P
    (oops, only needed 1 reason. oh well)

  22. Betting on Musk is the worst reason to buy Tesla.
    He tried to sell it; but with himself to remain at the helm caused that deal to break.
    I don’t trust him starting with the look in his eye.
    He has yet to make money on anything. This is a guy playing a Solar City/Tesla shell game and keeps making exploding rockets at Space X.
    Bet on Musk…..Why???????? Give us only ONE reason.

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