Trading Tesla After New Battery Megafactory Plans
Last year was Tesla’s largest-ever annual share price decline falling 65%. However, in the first-quarter of this year the stock was up nearly 70%. Learn more about the key factors affecting Tesla’s share price and what the analysts are forecasting for the stock below.
|Stock:||Tesla Motors Inc|
|Symbol for Invest.MT5 Account:||TSLA|
|Date of Idea:||11 April 2023|
|Time Line:||1 - 6 months|
|Position Size for Invest.MT5 Account:||Max 5%|
- The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.
All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.
Trading Tesla Stock: Things to Know
Tesla announced plans to expand in China by building a new megafactory to produce large-scale batteries. The plant, set to be in Shanghai, is expected to produce 10,000 of Tesla’s ‘Megapack’ energy storage units. These can be used to help stabilise energy grids and manage power outages.
This plant is on top of its current Megapack plant in California and an upcoming one in Berlin. While some analysts believe this could help to build another source of revenue for Tesla and help to cut costs on the development of its own electric vehicle (EV) batteries, some are still focused and concerned on the disappointing trend in EV sales in China.
Some analysts point to the fact that Tesla is helping to advance sustainable energy and transportation. Its technology is not just for electric vehicles but can be used in other sectors as well. Tesla’s pickup truck – the Cybertruck – is due to begin production at the end of the year which could help to lift overall sales and to grow the company further.
While Tesla’s new battery factories can help to cut costs in the long term, the EV maker did fall short of Wall Street’s first-quarter expectations on deliveries. In the first quarter, Tesla delivered 422,875 electric vehicles which is a 4% growth in deliveries from the same time last year but missed analyst expectations.
Investors have taken the recent price cuts as a potential structural cost advantage to Tesla as this will force other EV makers to reduce their prices. However, with rising commodity costs, it’s unclear how Tesla’s margins will be affected which is why some analysts are bullish, some bearish and some on hold.
Tesla Stock Forecast - What do the Analysts Say?
According to analysts polled by TipRanks for a Tesla stock forecast in the past 3 months, there are currently 19 buy, 10 hold and 3 sell ratings on the stock. The highest price level for a Tesla stock forecast is $300.00 with the lowest price target at $120.00.
The average price target for a Tesla stock forecast is $219.57.
An Example Trading Idea for the Tesla Stock Price
An example trading idea for the Tesla share price could be as follows:
- Buy the stock on a break above last month’s high at $208.00 to allow for current volatility.
- Target around the highest analyst price target of $300.00.
- Keep your risk small at a maximum of 5% of your total account.
- Time Line = 1 – 6 months
- If you buy 10 Tesla shares:
- If target is reached = $920.00 potential profit ($300.00 - $208.00 * 10 shares).
Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering how volatile Tesla’s share price can be.
Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.
With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Tesla stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.
There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall!
How to Buy Tesla Stock in 4 Steps
With Admirals, you can buy shares in companies like Tesla with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks.
- Open an account with Admirals to access the Trader’s Room.
- Click on Trade on one of your live or demo accounts to open the web platform.
- Search for your stock at the bottom of the Market Watch window and drag the symbol onto the chart.
- Use the one-click trading feature, or right-click and open a trading ticket to input your trade size, stop loss and take profit level.
Click on the banner below to trade Tesla stock today! ▼▼▼
Do You See the Tesla Stock Price Moving Differently?
Remember that all analytics and trading ideas are based on the personal view and experience of the author.
If you believe there is a higher chance Tesla's share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.
The Trade.MT5 and Trade.MT4 account allows you to speculate on the price direction of stocks and shares using CFDs.
This means you can trade long and short to potentially profit from rising and falling stock prices. Learn more about CFDs in this How to Trade CFDs article.
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