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A report on Cybertruck production could be driving the stock’s gains Thursday.
Courtesy Tesla
Tesla
stock is at it again. Sometimes when the stock goes wild finding a compelling explanation can be difficult. The move Thursday, however, seems rooted in the coming Cybertruck.
Tesla
(ticker: TSLA) shares have been on an incredible run recently, up for a 10th consecutive day, rising about 3% to $232.92. The
S&P 500
and
Nasdaq Composite
were up 0.4% and 0.9%, respectively.
All the numbers are impressive. The stock is the most active in the Nasdaq 100 Index Thursday, according to Dow Jones Market Data. The $232.92 level would be the highest close since Oct. 6, 2022, when the stock closed at $238.13. Shares were on pace for their largest percent increase since May 30, when they rose 4.1%. The 10-day streak has racked up gains of more than 27%. And it’s the longest winning streak since Jan. 8, 2021, when Tesla stock rose for 11 straight trading days.
The shares have risen about 14% in June and almost 90% for the year. Still, they are off about 43% from all-time highs of almost $410 a share, levels reached back in November 2021.
But why the rally now? Earnings are long past, second-quarter deliveries aren’t due for weeks. Is it the Federal Reserve pause, the AI rally, or a new Twitter CEO? Maybe. But Cybertruck certainly has something to do with the gains Thursday.
Electrek reported Thursday that Tesla is planning to produce 375,000 Cybertrucks a year. That is simply way more than Wall Street expects. Analysts project less than 100,000 units in 2024 and about 240,000 units by 2027. The 375,000 level is significant. Tesla sold about 252,000 Model Ys in the U.S. in 2022. The Cybertruck is primarily a North American product.
Tesla didn’t immediately respond to a request for comment from Barron’s about Cybertruck production.
The truck, unveiled in 2019, is expected to be shipped later this year. It will be built at Tesla’s plant in Austin, Texas.
To be sure, Tesla stock looks stretched. The shares are way above their 200-day moving average of roughly $200 a share and the stock is overbought, which is a technical term that essentially means a stock has gone up a lot quickly.
Practically speaking, overbought stocks reflect a lot of good news, which is a short-term risk for any stock. Investors aren’t thinking about risks right now; they’re only thinking of the rewards from a new model that might be a major hit for the electric-vehicle giant.
Write to Al Root at [email protected]
Source: https://www.barrons.com/articles/tesla-stock-cybertruck-5505644c?siteid=yhoof2&yptr=yahoo