S&P 500   4,594.62
DOW   34,899.34
QQQ   391.20
S&P 500   4,594.62
DOW   34,899.34
QQQ   391.20
S&P 500   4,594.62
DOW   34,899.34
QQQ   391.20
S&P 500   4,594.62
DOW   34,899.34
QQQ   391.20

To The Moon? Tesla’s Price Is Going To Mars 

Monday, October 25, 2021 | Thomas Hughes
To The Moon? Tesla’s Price Is Going To Mars 

Tesla Wow’s Market With Q3 Results 

Love him or hate him, Elon Musk has taken Tesla (NASDAQ: TSLA) to new heights and the climb has only just begun. While the EV story here on earth is a compelling driver of the stock’s value, in our opinion it is the Mars angle that will keep it moving up over the long term. If you didn’t know, one of Elon Musk’s motivators is a dream to colonize Mars, a dream that is playing out in the form of SpaceX, the Boring Company, and Tesla. 

The Boring Company makes these fancy little tunnel-building machines that just so happen to match the diameter of a SpaceX Falcon-9 rocket. Putting two and two together, we see SpaceX launching a fleet of The Boring Company machines to Mars and building a complex system of pneumatically sealed tunnels filled with electric-powered Tesla vehicles. Sounds far-fetched, we know, but so did “space tourism” only a decade or two ago. Now we have billionaires competing to see who can do it the flashiest. And of course, there is all the peripheral technology Tesla is involved with, any of which could become the next billion-dollar industry. 

Tesla Takes It To The Next Level 

Elon Musk’s brilliance lies not just in his engineering ability but in his management style as well. The company was able to ramp production by 64% and deliveries by 73% over last year to drive not only record revenue but record profits as well. The company reported $13.76 billion in consolidated revenue for a gain of 56.9% over last year to the increase in production. The volume of sales was, however, impacted by a negative price mix that resulted in a lower average selling price. Regardless, the company reported a significant expansion in margins due to revenue and cost-leverage and we expect additional margin increases as production begins to ramp in the EU gigafactory. 

Tesla reports the automotive gross margin at 30.5% versus the consensus of 28.4% and there is only one negative within the report. The company’s free cash flow is reduced versus last year but is more than offset by an increase in CAPEX. Moving down to the bottom line, the company’s margin strength is seen in the earnings. Tesla reported $1.44 in GAAP EPS and $1.86 in adjusted EPS to beat the consensus by $0.28 and $0.25 and post earnings growth of nearly 145% YOY at the GAAP level

The best news, however, may have come out over the weekend and days after the report. The company is raising the prices of its models by at least $2,000 each which will more than make up the difference in the average selling price seen this year.

Wall Street Likes What It Sees In Tesla’s Q3 Results 

Wall Street liked what it saw in Tesla’s Q3 results and has been gushing ever since. Not only did the company receive a credit upgrade from S&P that puts Tesla debt at near-investment quality but at least 11 analysts have issued statements. Of those 11 every single one included a price target increase that puts the fresh consensus near $850. There was only one downgrade. That assumes the stock is overvalued trading at current levels but there are two things to consider. The first is that the 11 most recent price target increases include the second-lowest target on Wall Street which is only $250. Backing that out, the consensus is closer to $910 and the Marketbeat.com consensus which makes the stock fairly valued. The second is that the high price target is $1200 and the bulk of new targets are in the range of $900 to $1200. 

The Technical Outlook: Tesla Breaks Out, Is Going Ballistic Again

Shares of Tesla broke out to new highs in the wake of the Q3 earnings report and are on track to more sharply higher. Based on the recent consolidation range and breakout we see at least $300 in upside ahead of us which puts the stock at the $1200 Wall Street high-price target. Assuming the market consolidates at or near that level, and the good news continues to flow, a move above that level is more than likely. 

To The Moon? Tesla’s Price Is Going To Mars 

Tesla is a part of the Entrepreneur Index, which tracks some of the largest publicly traded companies founded and run by entrepreneurs.

Should you invest $1,000 in Tesla right now?

Before you consider Tesla, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Tesla wasn't on the list.

While Tesla currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The 5 Stocks Here


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Tesla (TSLA)2.2$1,081.92-3.1%N/A350.14Hold$749.03
Compare These Stocks  Add These Stocks to My Watchlist 


Premium Research Tools

MarketBeat All Access subscribers can access stock screeners, the Idea Engine, data export tools, research reports, and other premium tools.

Discover All Access

Market Data and Calendars

Looking for new stock ideas? Want to see which stocks are moving? View our full suite of financial calendars and market data tables, all for free.

View Market Data

Investing Education and Resources

Receive a free world-class investing education from MarketBeat. Learn about financial terms, types of investments, trading strategies and more.

Financial Terms
Details Here
MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau

© American Consumer News, LLC dba MarketBeat® 2010-2021. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | U.S. Based Support Team at [email protected] | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Do Not Sell My Information

© 2021 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer. Fundamental company data provided by Zacks Investment Research.