Tesla Inc. (NASDAQ :TSLA), is a great place to start if you are looking to invest in electric vehicles and solar panels, or to add an automotive industry heavyweight to your financial plan.
Tesla is a favorite of environmentally-conscious consumers from all walks of life, including maverick millennials and eco-friendly baby boomers. Tesla is a great way to slow the rise of global warming and decrease carbon footprints. It has also helped to deliver solar-powered homes for people who want clean, efficient energy to their lives.
Are you ready to purchase Tesla stock? Find out more about Tesla stock, its performance and how to add shares to your portfolio. You could reap dividends by adding a popular, eco-friendly brand to your portfolio.
The History of Tesla Inc.
- 2003: Started By Martin Eberhard & Marc Tarpenning
- 2008: Tesla Roadster introduced to the market
- 2010, Go public with an initial public offer (IPO) at $17 per share
- 2016: Acquired Solar Panel Manufacturer SolarCity
- 2020: Tesla Model 3 won the UK Car of the Year 2020. In August, the stock was split 5 to 1 and traded at a record $695 per share in December.
- 2021:Tesla surpassed $900.40 to reach a new all time high after reporting an EPS of $0.80, and revenue of $10.74 trillion.
- 2022 – Tesla’s stock price fluctuated between $270 and $320, before dropping to $120 at the end of the year.
- 2023 While Tesla stock has started to recover in 2023 due to Elon Musk’s somewhat turbulent foray into Twitter, it has had an impact on the public sentiment surrounding the company.
How to buy Tesla stock
Tesla trades on NASDAQ under the ticker symbol TSLA. Tesla does not offer a direct stock buying option unless you are employed by Tesla. You will need to use a broker to purchase Tesla stock.
You also have many options. There are many options: You can short sell Tesla stock, keep or sell your Tesla stock depending upon its performance, or you can look into Tesla stock options.
To be able buy TSLAshares, you will need a brokerage account. You should not invest more than you can afford to loose.
Step 1: Purchase through your brokerage
After you’ve set up your brokerage account, you can choose to either buy Tesla stock at the current market price or buy a call option or put option. You can either buy the stock at market price or you can sell it.
You can only trade a call option or put option that you have purchased for a short time. You would like Tesla’s stock price to rise before you trade it.
Step 2: Select a strike price.
The strike price is the price you will pay to purchase a stock option at an inflated price. If Tesla stock is valued at $664 currently, you can set a strike price for $650 to purchase put options.
If Tesla stock falls below $650, you can sell put options to make a profit. If Tesla stock dropped to $640, your profit could be $10 per put less the premium.
Step 3: Choose an expiration date.
Each put and call option purchased has an expiration date. Options held by investors after the expiration date become null. You can set the expiration date anywhere from 1 week to 2 years, or even several years.
Set an expiration date wisely. It gives you the opportunity to trade your call or put options freely. The longer an expiration date is set, the higher the premium you’ll pay for the options you have purchased.
Step 4: Decide on how many contracts are you interested.
Every call or put option you make to purchase a stock comes with 100 shares of stock. You can choose how many contracts you wish to purchase, depending on your financial situation and how you feel about the prospects of a company. A broker or financial advisor can help you make a decision.
Step 5: Watch stock prices.
Is Tesla stock overvalued? You may find the stock overvalued at times. However, you might be able to extract value from it for a long time. Many people wonder if Tesla stock should be sold. They aren’t sure if the stock can go higher or if other EV manufacturers will take it over.
According to the NASDAQ, Tesla stock’s 12-month average price target is $455. It has a high estimate at $788 and a low estimate at $60. Based on Tesla’s performance in the market recently, you should allow yourself more than one week to take advantage the stock options. You can monitor Tesla stock prices here, and keep an eye on their day-to-day values while you are holding onto them.
The Cons of Buying Tesla Stock
Keep in mind that Tesla stock is not always a positive stock. Tesla is not without its problems, from the planned factory in Wolfsburg to reliability to Elon Musk’s public persona.
- Tesla’s famous CEO Elon Musk is known for his eccentricity. Musk’s questionable behavior has a direct effect on Tesla’s stock price. It is not surprising that Musk has been assigned a supervisory board to oversee his behavior.
- Musk’s online presence is actually an advertisement for other things, such as cryptocurrencies, SpaceX, and any other thing that may pique his curiosity.
- Tesla’s stock price has fluctuated each day to the best of our knowledge.
- Tesla stock does not pay dividends to investors.
- There have been accusations against Tesla vehicles that they are unsafe, unreliable, or poorly constructed. It’s not easy to understand the complexity of modern vehicles and the technology that underlies them, but stock prices tend to follow the news cycle.
- Elon Musk appears to be thin, as reports from early 2023 indicate that he has been sleeping at the Twitter headquarters, selling items within the office, and other activities.
The pros and cons of buying Tesla stock
- Tesla’s stock is very volatile, and investors have a decent possibility of profiting from its volatility without investing a fortune.
- CNBC reports that Elon Musk’s net worth has increased by $140 billion due to the 650% increase in TSLA stock. At current market prices, you would have earned $63,300 profit if you had spent $1700 on 100 shares TSLA stock stock during its initial public offer in 2010.
- Tesla is the first auto company to go public since Ford’s 1956 debut. Tesla’s market capitalization is $627.29 million as of March 2020. This is more than General Motors or Ford combined.
- Tesla is always innovating, whether it’s self-driving cars or sustainable and economically viable energy reserves for your home.
- In the third quarter 2020, Tesla shipped over 139,000 electric cars. Although plans to open a factory at Germany were delayed, Tesla still has a new manufacturing facility in Shanghai, China that is ready to grow in 2021.
- In the face of an economic recession and a global pandemic, Tesla was able to produce a record number electric vehicles.
How does Tesla Stock perform?
Tesla stock has had a remarkable performance over the past decade, making it one of the most successful stocks in recent history. After years of range trading, Tesla’s stock price surged to the upside following 2020. It rose from $100 per share to more than $1,000 per shares, as the price chart below shows.
Why invest in automakers?
Tesla is in a unique category today. Tesla stock has a market capitalization close to $633 billion despite having only been in business for two decades. This makes it the most valuable automaker worldwide. Tesla’s current value is more than twice that of Toyota (NYSE:TM).
Although no one can predict the future, Tesla stock’s dramatic success may increase if consumers continue to follow their predicted trajectory. First, the younger generation — Generation Z and millennials — places a high value on corporate social responsibility. Therefore, it is not unreasonable to expect that modern consumers will place greater emphasis on environmental responsibility.
Evidence shows that all demographics are aware of the importance and value of sustainability. According to a McKinsey & Company survey, 77% of European consumers believe that businesses should be more focused on reducing pollution as a result of the COVID-19 epidemic. Respondents to the survey stated that 57% had made substantial lifestyle changes in order to reduce their carbon footprint.
Don’t think the U.S. is behind in this area. A Pew Research Center survey found that most Americans support climate change mitigation measures. This is why Tesla stock and its EVs have captured the public’s attention. Consumers can drive these sleek machines and still get their cake.
It’s not surprising that legacy automakers are now interested in developing their own EVs to rival Tesla. While TSLA fans remain confident that the underlying company will be able to fend off potential rivals, shareholders need to be aware of the challenges ahead.
Here are some key points to keep in mind:
- Ubiquity & its liability: Although it is true that EVs have become almost ubiquitous due to Tesla’s innovative approach and pioneering spirit, this attribute could also be a liability. The first Tesla customers felt special and became personal mobility pioneers. As Tesla expands its brand, especially the Model 3, the company will continue to introduce an “identity” to electric vehicles. This is a great backdrop for major rivals, such as BMW and Mercedes-Benz to step in and offer some much-needed variety.
- Economics matters: There is ample evidence that environmental advocacy groups have succeeded in convincing customers around the world about the importance of sustainability. People will select the more sustainable product if it is within their means. A McKinsey separate survey of U.S. customers revealed that sustainability was more important than price and other attributes. Despite Tesla’s best efforts to provide affordable EVs, even the cheapest models can be very expensive for average households. This opens up the possibility of lower-cost competitors.
- Legacy relevance While Tesla stock has soared since the mainstreaming of EVs was announced, don’t make the mistake to think that legacy automakers are insignificant. It may take years for electric-powered competitors to overtake their fossil-fueled counterparts. The Brookings Institution says that it is difficult for modern societies not to use fossil fuels because they have a high energy density. Modern cars can travel up to 30 miles using a single gallon gasoline. However, electric vehicle batteries aren’t as dense in energy.
- Infrastructure dependence: The infrastructure for combustion-based cars is already in place, unlike EVs. To convince the masses to switch to electric cars, both the government and the corporations need to invest heavily in charging station infrastructure. It is unlikely that electric carmakers will surpass their traditional counterparts without this rollout. It is important to remember that only 63% U.S. homes have a garage/carport. This limits the number of people who can charge their cars at home.
- Innovation is universal: It is obvious that Tesla stock has a lot of appeal. The underlying company continues investing millions in research and development to produce vehicles that are comparable in range, features, and convenience to their combustion counterparts. Legacy automakers are also innovating. The combustion cars of today are more efficient than ever and produce significantly less emissions.
Tesla Stock Forecast
Tesla Inc. is the 11th largest company in terms of market capitalization. This stock has shown that it can deliver high returns in short periods of time. Many investors are curious about Tesla’s stock direction in this turbulent market.
Although current economic conditions look grim, many experts remain optimistic about Tesla stock. Some experts are worried about the stock of this electric vehicle (EV manufacturer).
Stocks can be pushed in any direction by market uncertainty. Many experts have made price predictions and recommendations for Tesla stock.
Current Tesla Broker Ratings
When comparing strong buy to strong sale on a scale from one to five, the average brokerage recommendation (ABR), was 2.24.
Eleven brokerages gave Tesla a strong buy rating, while two others rated it as a stock that should be bought. Two brokers recommended that the stock be sold, while 12 recommended that it be held.
Strong buy is the most popular recommendation, accounting for 40%. A buy position is 7% of all recommendations.
Comparing recommendations from three months ago and current recommendations shows that 12 brokerage firms recommended a strong purchase, while only 11 firms currently hold that position.
From three months ago, the buy recommendation is unchanged with only two firms still holding this view.
Nine brokers had recommended that a holding position be taken three months ago. Twelve firms share the same sentiment at present.
Tesla stock is currently recommended by two firms as a strong seller, while three other firms did the same three months ago.
Three months ago, the ABR was 2.21.
Another 13 brokerage firms’ recommendations reveal that Tesla stock is being rated by nine firms as it was a few months ago. Six firms recommend it as a strong purchase and three recommend a hold.
Although Tesla stock was not previously rated by two brokerage firms, one recommends a holding position while the other recommends a strong buy.
Oppenheimer Holdings had previously recommended Tesla stock as a solid buy, but has downgraded it now to hold. Tudor, Pickering, Holt & Co. echoed this sentiment.
Tesla Stock Predictions for 2025
Tesla Inc. (NASDAQ TSLA: TSLA), has long been a favorite stock for investors. CEO Elon Musk’s rise in prominence has only increased the attention to the company. The stock is not compelling in 2022 as the electric vehicle (EV), giant faces headwinds such as Federal Reserve rate increases, China’s zero COVID policy, and Musk’s involvement with Twitter.
Investors will hope that the stock performs well in the future, as the Twitter takeover has been a significant headwind in recent months.
What can investors expect from Musk’s plans to start new businesses and sell a portion of his Tesla shares in the future?
What Will Tesla Stock Look Like in 2025?
Musk’s apparent lack of focus on Tesla has drawn a lot of attention. Strong leadership is crucial to prevent further declines. What could Tesla stock look like in 2025?
The stock faces constant external headwinds going forward. Automakers face supply chain challenges and historically high inflation will likely reduce customer spending on household goods.
In 2022, bears took over and Tesla’s problems are likely to continue in the future. EV manufacturers are competing more each year, but Tesla is still the dominant player in the U.S. market.
The firm’s global demand is still a major concern, particularly with China’s supply chain problems. A change in the macro environment is necessary if Tesla wants to achieve its highs and continue its rapid growth.
Tesla stock price growth in the coming year is doubted by investors. Many of the remaining problems are external and future earnings will depend on the global economy.
A weak economy will likely impact EV sales. However, higher interest rates and a weak economy won’t last forever. Tesla could take steps to increase demand for its products.
Many anticipate further price reductions and discounts for Tesla in 2023. Although this may result in a decrease in profit, it could drive sales, which could encourage EV adoption, and hopefully push its stock higher. Tesla is still one of the most profitable EV manufacturers due to its high sales prices.
Although there are short-term headwinds to its growth, long-term growth remains possible. Musk’s promise not to sell any more Tesla stock until 2025 is another factor that could help stabilize its share prices. It is unclear whether investors will believe him.
There is a legitimate question about whether Tesla is still overvalued despite its significant decline.
Morgan Stanley analyst Adam Jonas noted that Tesla lost $600 billion in its market value within three months. The significant decline in valuation of Tesla, which is an “ambassador” of EVs, “raises questions about investment returns across the sector.”
Jonas anticipates that Tesla prices will continue to fall in Europe and the U.S. after price cuts in China. The analyst, who is a Tesla bull, sees the pullback in shares as an opportunity to buy.
Tesla shares could be in recovery mode for months. However, it is possible that Tesla shares will rise significantly over the next few decades. This is despite these concerns.
