New Tailwind For Tesla: Have You Bought In Yet?

If it seems like a lot of 2020 was devoted to suggestions that you buy in on Tesla (NASDAQ:TSLA) stock, it's probably because it was. This company spent most of this year on an upward tear, making deliveries, making sales, and making improvements to its product line that couldn't help but catch notice. With the company up around 730% this year, reports note, the year's final day of trading should be another good one for Tesla.

Short Sellers Continue to Lose

Yesterday's trading featured a huge new milestone for Tesla, as the company hit a new all-time high, and there were signs of continued increase with today's trading as well. The company is setting its sights on closing out the year at or above the $700 per share mark, and with the company trading at $702.05 as of this writing, it looks like that's a goal that's well in sight, barring some calamity between now and the end of the trading day.

It's been an absolutely disastrous year for short-sellers of Tesla stock; we've seen several reversals for such trades, and the latest reports from S3 Partners note that short-sellers have lost about $38 billion so far this year betting against Tesla. The next closest loss-producer for short-sellers, that data noted, was Apple (NASDAQ:AAPL), which generated about $7 billion in losses for short-sellers this year.

The Analysts Are Less Supportive

Perhaps the most interesting part about Tesla lately is that it keeps shooting upward, despite the comparatively slim amount of analyst support. Our latest research notes Tesla has a consensus rating of “hold”, and it's had that rating for the last six months. The ratios have swung a little either way, but the consensus remains about the same. Six months ago, the company had 11 “sell” ratings, 14 “hold” and 9 “buy”. A month ago, it was at 11 “sell,” 11 “hold”, 10 “buy” and one “strong buy.” Today, the company is at 11 “sell” ratings, 13 “hold”, eight “buy” and the “strong buy” has departed.

Price targets don't even vaguely reflect reality; six months ago, Tesla had a price target of $126.04 per share, which at the time represented a 19.32% downside against prices at the time. Today, it's perched at $296.50, which isn't even half the current share price.

More Than Just Wishful Thinking

It would be easy to dismiss Tesla as a kind of post-modern dot-com fantasy, a relic from an era in which any company who wanted to make big money on the stock market put a “dotcom” somewhere in their name and ran with it accordingly. Tesla, however, is showing signs that it's not just a pie-in-the-sky fantasy, but rather a proposition with a market, a maturing product line, and more.

Several revelations have recently emerged surrounding Tesla; first, from a few days ago, new word hit the market that Tesla was poised to roll out the Model 3 in India starting in 2021, a move that would give Tesla access to a new major market that's likely eager to get more electric vehicles in play. While the early efforts were likely to be sales-focused, there was word that manufacturing efforts may follow if the sales are sufficiently brisk.

Hot on the heels of that game-changer in the making came word that Tesla beat its own record for sheer size of a Supercharger station. Supercharger stations are large-scale installations that allow Tesla owners to have a place to recharge their vehicles. The previous record was a 56-stall operation in California. The new record is a 72-stall operation in Shanghai, and makes it quite clear that Tesla owners—at least those in certain places—can always find a place to recharge.

The news isn't all good for Tesla; reports suggest that it's not likely that the company will cut prices on the Model 3 sedan in China, and may actually increase prices. Price hikes—at least those without some concomitant increase in quality—tend to make a market more accessible to competitors. With plenty of those already knocking on Tesla's market doors as companies from Nio (NYSE:NIO) to Ford (NYSE:F) look to get involved, that's not a development Tesla shareholders should welcome.

Tesla has a big first-mover advantage in the electric vehicle maker field right now, as competitors from all over try frantically to get involved in the field themselves. That's an opportunity for Tesla to build a market, which could become a loyal following if done right that continues to buy Tesla into the second generation of buyers and beyond. If Tesla can play its collective cards right, it can come out well ahead and make itself a valuable part of any portfolio.

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