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Tesla Inc. Stock Shock and the $400 Per Share Fake-out

Tesla Inc (TSLA) Store in Southern California

Tesla shares surged to highs of $383 in the months building up to July. “Four hundred dollars!,” the bulls proclaimed. “Just you wait and see.” Well, shareholders are still waiting while that $400 price appears to be more a mirage than reality. Tesla shares spiked spectacularly during 2017’s second quarter. Their performance was far too big for anyone to overlook. However, perhaps still caught up in the spirit of Independence Day, investors quickly liberated themselves from the stock this week.

TSLA is unlikely to breach the bottom $300 mark, but who can say for sure? When momentum gets going in one direction, it can be pretty hard to slow down. That is of course unless you pull out news about building the biggest lithium-ion battery ever. Word about the venture certainly seemed to smooth things out this Friday. After a week’s long plummet, the company’s efforts in Australian have put it back in the green.

Will Tesla shares stay on the up-and-up, though? Gene Munster seems to think so. In a lovely little note posted this week, the Loup Ventures CEO relayed his enthusiasm about Tesla. So, what’s working in favor of the electric carmaker?

Tesla Inc Tesla Shares Model X
Tesla Inc Model X charging – Tesla

Despite disappointing sales results this week, Tesla is poised for greatness. No need to take my word for it, though. Just ask Gene Munster of Loup Ventures. The CEO compares the incoming Model 3 to Apple and its iPhone. He is also adamant that the transformation brought on by the new Tesla will push the auto market into a new realm of transport.

A research entity, IHS Markit, weighs in on the other side of the scale. It considers the sunny US state of California and how Tesla lost its flavor there. Well, it did in April anyway. For the automaker’s biggest EV market, the state hadn’t registered a lot of Teslas that month. According to IHS Markit, the number of Tesla cars registered in California dropped by 24 percent back in April.

IHS Markit’s findings might be small fries, yet they are not at all irrelevant. News of their research came forward just as TSLA investors worried about poor sales. The company shared some disappointing news this week. Sales over the last 6 months land at the very low end of its own predictions. This brings up all sorts of questions about oversold promises, a term that is synonymous with Tesla in some circles. Chief among investor concerns right now is the treatment of Tesla’s current models while the Model 3 takes center stage.

Reuters says the Elon Musk auto business refused to comment of IHS Markit findings. However, the company pointed out that year-on-year, worldwide deliveries spiked 53 percent. So, growth is actually impressive, just not impressive enough in contrast to the company’s own projections.

Tesla shares power up on battery news

Tesla shares recovered somewhat this Friday. The company is a long way off from its June 22 record, yet shares seem to be moving positively for now. News broke out on Friday about the company’s plans to get into bed with Neoem. The Australian energy company wants Tesla to help it build the world’s largest lithium-ion battery.

Musk made news of the venture himself and said the project would be large and not without risk. This is because the battery will be the biggest ever by a large margin. The news took investors’ minds off the lackluster Model S and Model X sales of the last six months. Friday saw Tesla shares grow 4 percent, a fair climb considering its week of plummets.

Are Tesla shares still going to hit $400?

Ron Baron is known for his long view when it comes to investments. When is comes to Tesla, the Baron Capital head believes the company can grow 150 percent leading up to the end of 2020. Tesla shares moved from the $200 mark are start of this year to $382 in June. This week sees TSLA taking a hefty blow, but its certainly no loser’s stock right now. Baron says the good times will keep on coming.

Baron also believes Tesla is the “most interesting” investment opportunity he has ever come across. Bullishness like his is not uncommon as of late. The Baron Capital boffin says the young carmaker will swim around $500 to $600 in 2018. Beyond that, Tesla shares are “going to be $1,000 in 2020.”

Analysts concede that Tesla shares remain one of those stocks you ought to keep tucked away in your portfolio. Think long-term when it comes to Tesla Inc. The electric car market is not a niche space but the inevitable future of motoring.

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