Tags: tesla | shares | model 3 | stock | price

Model 3 Price Hype Helps Tesla Shares Bounce

Model 3 Price Hype Helps Tesla Shares Bounce
(Mohamed Ahmed Soliman | Dreamstime)

Monday, 21 May 2018 11:02 AM

Shares in Tesla Inc. jumped more than 4 percent on Monday as investors were encouraged by the company's placing a $78,000 price tag on the fully-loaded version of its Model 3 sedan.

Separately, research firm Berenberg raised its price target for Tesla shares (TSLA) to $500 from $470, saying the company's margin targets for the car were now reality and not just a hope.

Berenberg's earlier forecast was already the most bullish on Wall Street and compares to the company's current stock market price of $288, which is down around $100 dollars from last September's peak.

Chief Executive Elon Musk said in tweets at the weekend that Tesla would focus initially on delivering the fully-loaded Model 3s, which come with a full range of bells and whistles but not its vaunted autopilot feature.

"Cost of all options, wheels, paint, etc is included (apart from Autopilot). Cost is $78k. About same as BMW M3, but 15 percent quicker & with better handling. Will beat anything in its class on the track," Musk tweeted.

A BMW M3 starts at $66,500 while Tesla's own Model S starts at $74,500.

Analysts say Tesla's future growth hinges on the success of the Model 3, its most affordable vehicle to date at a base price of $35,000. The company has so far struggled to ramp up production and failed to reach a series of weekly production targets.

Musk, whose refusal to answer questions from some analysts in a call earlier this month prompted a fall in shares, said that Tesla had to focus on delivering higher-priced Model 3s first, or it would "die."

The company, which is undergoing a "thorough reorganization" to contend with production problems, senior staff departures and recent crashes involving its electric cars, is striving to reach a production rate of 5,000 cars per week.

"With production, 1st you need achieve target rate & then smooth out flow to achieve target cost. Shipping min cost Model 3 right away wd cause Tesla to lose money & die. Need 3 to 6 months after 5k/wk to ship $35k Tesla & live," Musk said.

On Friday, proxy adviser Institutional Shareholder Services (ISS) backed a shareholder proposal to separate Musk's current chairman and CEO roles, suggesting that shareholders would be better served by having Musk focus on running the company. .

The recommendation by ISS echoed one made earlier last week by rival proxy adviser Glass Lewis & Co. 

© 2019 Thomson/Reuters. All rights reserved.

   
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Shares in Tesla Inc. jumped more than 4 percent on Monday as investors were encouraged by the company's placing a $78,000 price tag on the fully-loaded version of its Model 3 sedan.Separately, research firm Berenberg raised its price target for Tesla shares (TSLA) to $500...
tesla, shares, model 3, stock, price
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2018-02-21
Monday, 21 May 2018 11:02 AM
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