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Tesla Shares Could Receive Support From Cybertruck

Tesla (TSLA)

Tesla (NASDAQ: TSLA) shares plunged more than 6% in a single day following the launch of an electric pickup truck. Bear’s concerns over futuristic design along with the price point pulled back Tesla’s stock price from $350 to $333.

Elon Musk tweets during the weekend regarding the huge orders for electric pickup trucks could help in enhancing sentiments.

In addition, analysts say Tesla is well-positioned to snatch market share from Ford (NYSE: F) and General Motors (NYSE: GM). Citi analyst Itay Michaeli believes Ford has more risk than General Motors from the Electric truck launch.

GE General Electric Company daily Stock Chart

Strong Orders Show Customers Interest in Cybertruck

Elon Musk tweeted that they have received more than 200K orders for Cybertruck in a single day. The orders are higher from the analyst’s expectations. Wedbush was expecting its first-year orders to stand around 175K. Meanwhile, the orders for Cybertruck have already crossed the analyst’s expectations.

The potential customer is required to pay $100 in the refundable preorder fee. The substantial growth in orders indicates strong marketing games from Tesla along with customer’s confidence in their innovative production techniques.

Image result for tesla cybertruck

The Cybertruck has several innovative features. For instance, the company claims the Cybertruck has the potential to increase the speed from zero to 60 in just 2.9 seconds. The truck also has the capacity to carry 14K pounds. Musk played a video where the Cybertruck beat outraced a Porsche 911 off the starting line and beat F-150 in a tug of war.

The Launch of Cybertruck Is a Catalyst for Tesla Shares

Although Tesla shares plunged sharply following the initial launch, the future fundamentals look strong considering huge orders. It is likely to significantly expand its revenue base in the coming years.

Wedbush says, “We believe this next generation Cybertruck model could help Tesla expand its market opportunity outside its core customer base over time, although gaining market share with stalwarts such as Ford and GM entrenched in this landscape will be a difficult task for Fremont.

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Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.