Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Will Tesla Top $200 by Year End?

It's hard to believe there is any upside left in Tesla Motors (NASDAQ: TSLA  ) , considering the stock has gained more than 530% over the past year. However, the electric carmaker continues to prove skeptics wrong. Yesterday, shares surged as much as 5%, to around $185 apiece, after Wedbush analyst Craig Irwin said the stock was worth $240. However, the recent analyst upgrade is primarily based on higher sales expectations for the company's Gen III EV, which isn't expected to hit full production until 2017.

So what near-term catalysts exist for this stock? Let's take a closer look at two things that could help Tesla pass the $200 mark before the New Year.

Ballooning sales growth
Tesla has consistently increased sales of its Model S cars every quarter so far this year. The California-based company delivered a record 5,150 vehicles in its latest quarter, up from 4,900 EVs in the first quarter of fiscal 2013. Additionally, Model S sales growth should only get stronger now that Tesla is making deliveries in Europe. There are currently 20 Tesla stores open in Europe, and three in Asia.

While Tesla says it expects to deliver slightly more than 5,000 cars in its third quarter, analysts are more optimistic. Wedbush now estimates Q3 deliveries of around 7,000 vehicles. That number would certainly be impressive. However, it may not be too far off the mark, given Tesla's reputation for conservative forecasts.

International expansion
Tesla is in the early stages of an Asian invasion. The EV maker currently has retail stores in Hong Kong and Japan, with plans to open additional locations in Asia in the year ahead. Make no mistake -- the world's biggest auto market is a key piece of the puzzle for Tesla as it strives to live up to its $22 billion valuation.

If Tesla is able to replicate its North American success in the Asian market, annualized Model S sales could exceed 40,000 vehicles per year by 2014, according to a company filing. Management should give us a better view of Tesla's operations in Asia when it reports quarterly results on Nov. 4. And, if investors like what they hear, it could push the stock higher.

Importantly, Tesla is already showing signs of strong international sales in Europe. The company is on track to deliver 800 Model S cars this year in Norway alone. Tesla also plans to expand its European operations, adding stores or service centers in a total of 15 cities in Germany, France, Austria, the Netherlands, Switzerland, Sweden, and the U.K. before year's end.

Finally, the availability of Tesla's Supercharger Network throughout Europe should also boost international sales for the company. In fact, Tesla says:

By the end of 2014, 100 percent of the population of Germany, the Netherlands, Switzerland, Belgium, Austria, Denmark and Luxembourg will live within 320 km of a Supercharger station, with about 90 percent of the population in England, Wales and Sweden living within the same distance of a charging station.

This should be a big selling point for potential Tesla owners, because these Supercharger stations potentially enable European Model S drivers to travel for free within their countries, as Norway's current Supercharger network does . The company hasn't shared specific sales figures yet from these international markets. But as more details emerge next month about Tesla's opportunities overseas, it could be a major catalyst for the stock.

What's an investor to do?
Tesla is undoubtedly one of this year's best momentum stocks. Moreover, as 2013 draws to a close, it shouldn't have any problem reaching $200 per share, particularly if management delivers another solid quarter of sales growth, and prospects abroad appear on track.

Invest in automakers for a surging Asian market
U.S. automakers boomed after WWII, but the coming boom in the Chinese auto market will put that surge to shame! As Chinese consumers grow richer, savvy investors can take advantage of this once-in-a-lifetime opportunity with the help from this brand-new Motley Fool report that identifies two automakers to buy for a surging Chinese market. It's completely free -- just click here to gain access.

Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2686102, ~/Articles/ArticleHandler.aspx, 9/25/2016 6:41:24 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,261.45 -131.01 -0.71%
S&P 500 2,164.69 -12.49 -0.57%
NASD 5,305.75 -33.78 -0.63%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/23/2016 4:00 PM
TSLA $207.45 Up +1.02 +0.49%
Tesla Motors CAPS Rating: **