Tesla at a crossroads on the stock market? : tip of the day

Tesla makes a splash! The American electric vehicle giant made a record profit of $5.5 billion in 2021 for one million cars sold! The manufacturer displays “the best margin rate in the auto sector, at 12%”, underlines Antoine Fraysse-Soulier, head of market analysis at eToro. If Tesla is confronted like its competitors with supply problems and a shortage of chips, it is relatively less affected. “This is largely due to its decision to open a Gigafactory in Shanghai, which gave it access to the raw materials it needs and became its main export platform,” says the expert.

From a fundamental point of view alone, the price targets of financial analysts make the big difference, because of the difficulties in assessing the theoretical fair value of the action. If the potential of the electric car market is very high, competition (from Volkswagen, Ford, General Motors… among others) is likely to be tough… Credit Suisse, neutral on the value with a price target of 1,025 dollars, expects a rise in Tesla’s delivery volumes by 2030 and an improvement in its gross margin. But JPMorgan is only targeting $325 on the stock, with an “underweight” recommendation.

Livermore Partners, a hedge fund that has bet down on Tesla, believes that the stock could drop by half, due to a high valuation. He underlines the risks of pressure on sales prices (tougher competition) and the profitability of Tesla, which could also suffer from a possible slowdown in the automotive market and a stronger and faster than expected tightening of policy. monetary policy from the Fed (which would have a negative impact on growth stocks, such as the firm founded by Elon Musk).

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What does technical analysis say?

From a technical analysis standpoint, Tesla has had a dizzying stock market journey, with a 16-fold increase in price in just three years. After breaking the ascending support formed by the 100-day moving average, Tesla stock is currently testing a major support at 850-886 dollars (crossing point of the lower limit of the long-term bullish channel in arithmetic scale and horizontal support zone, 150-day moving average, etc.). In the event of a clear break and at the close of this important support zone, a medium-term investor would be encouraged to be more cautious about the value…

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