How Will Tesla Stock Perform in 2022?
Over the last couple of years, electric vehicle (EV) manufacturer Tesla has spent its fair share of time in the headlines. Whether it’s because of its phenomenal performance in the stock market, or the actions of eccentric CEO Elon Musk, there is usually plenty of material for writers to sink their teeth into.
Whilst its 2021 performance has been fairly muted when compared to 2020 – during which share price increased more than 743% - Tesla stock was up almost 54% for the year when the session closed yesterday, significantly outperforming the S&P 500, which has risen 27.6% year to date.
These remarkable gains have seen Tesla’s market capitalisation surpass $1 trillion, making it the sixth largest company in the world by this measurement and almost four times the size of the next largest car manufacturer, Toyota.
With such impressive past performance, it begs the question, what’s next for Tesla stock? Can it continue to beat the market in 2022?
Well, it’s certainly too soon to tell whether Tesla will outperform the market for the third year running. However, earlier this week, Wall Street analyst Dan Ives reiterated a 12-month price target of $1,400 for Tesla stock, with his most bullish scenario calling for a target of $1,800. Even with the more cautious target, this would represent an increase of almost 29% from yesterday’s closing price. Why the optimism?
Tesla find themselves in the enviable position of manufacturing a product for which demand significantly outstrips supply. This means that one of the largest challenges facing Tesla going forward is its ability to expand production and translate this high demand into higher sales. Can Tesla put themselves in a position to take better advantage of this demand next year? Analyst Ives seems to think so.
In 2020, Tesla delivered almost 500,000 EVs and, subsequently, set themselves a target of delivering 750,000 EVs this year. By the end of Q3, they found themselves around 122,500 vehicles short of this target and, whilst official Q4 sales figures are not yet available, analysts forecast that Tesla will significantly exceed their goal.
Ives believes that this production capacity is set to further increase next year and estimates the company should have the capacity to produce 2 million EVs a year by the end of 2022. A lot of this predicted growth in production is expected to be covered by new factories opening in Berlin and Texas but will depend on how smoothly life starts at both facilities.
If Tesla is able to significantly increase production, as Ives predicts, then Tesla shares may be set for another impressive year in 2022. However, if we have learnt anything over the past two years, it’s that the world is unpredictable, and, therefore, potential investors should weigh up all the evidence themselves before making any investment decisions.
Invest with Admirals
With an Invest.MT5 account from Admirals, you can buy shares in Tesla and over 4,300 other companies from 15 of the largest stock exchanges in the world! Other benefits include:
- Opening an account with a minimum deposit of just €1
- Free use of the world’s number-one multi-asset trading platform, MetaTrader 5
- Exclusive access to out Premium Analytics portal, where you can find the latest market news, sentiment and technical insight at no extra cost!
To start enjoying all these benefits and many more, click the banner below and register for your account today:
INFORMATION ABOUT ANALYTICAL MATERIALS:
The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admirals investment firms operating under the Admirals trademark (hereinafter “Admirals”) Before making any investment decisions please pay close attention to the following:
- This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.
- Any investment decision is made by each client alone whereas Admirals shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.
- With view to protecting the interests of our clients and the objectivity of the Analysis, Admirals has established relevant internal procedures for prevention and management of conflicts of interest.
- The Analysis is prepared by an independent analyst Roberto Rivero, Freelance Contributor (hereinafter "Author") based on personal estimations.
- Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admirals does not guarantee the accuracy or completeness of any information contained within the Analysis.
- Any kind of past or modelled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admirals for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.
- Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.