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The incredible run for
Tesla
shares continues. The stock rose again Monday after beginning to trade at a lower, split-adjusted price.
The stock split, however, isn’t the only thing affecting shares. Wall Street can claim some of the credit.
Tesla (ticker: TSLA) stock closed up almost 13% to $498.32 Monday, leaping past even some of the more bullish projections for where the stock would trade so soon after splitting.
The stock is now up more than 80% since management announced a 5-for-1 stock split on Aug. 11. The gain is about 495% year to date. Both numbers are vastly higher than the comparable returns of the
S&P 500
and
Dow Jones Industrial Average
over the same spans.
The split, however, isn’t responsible for all the gains. Argus Research analyst Bill Selesky raised his price target to $566 a share, the highest on Wall Street. That’ is $2,830 on a pre-split basis, so it exceeds the $2,500 target—now $500—from Jefferies analyst Philippe Houchois.
The average target price for Tesla stock is up from roughly $50 to $260 a share over the past year. Fivefold increases are rare, to say the least, but the stock is almost 90% above that higher level.
It reached a premium of 102% in July. The stock has continued to gain since then, but analysts keep raising their target prices, too.
That makes the current trading environment unprecedented. Where Tesla stock goes from here is anyone’s guess.
One key point to watch is whether the people who oversee the
S&P 500
decide to include Tesla in the index. That would drive some buying by funds tracking that benchmark.
Another factor is what Tesla has to say when it hosts a so-called battery-technology day in September. That could move the stock either up or down.
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SOURCE: https://www.w24news.com
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