Tesla stock rebounds, gains 27% in a week

Texas: Tesla’s stock price surged on Friday, erasing its losses for the year and boosting its weekly gain to 27 percent. Shares of the electric vehicle (EV) manufacturer closed at 251.55 dollars, surpassing their end-of-year price of 248.48 dollars, despite having fallen to a low of 138.80 dollars in April.

The recent rally was fueled by an unexpectedly strong second-quarter deliveries report released on Tuesday. Although deliveries dropped 4.8 percent from the previous year, the decline was less severe than in the first quarter, instilling optimism among investors for the remainder of the year.

As per reports, in April, Tesla's shares reached a 52-week low due to a series of concerning developments. The company reported declining sales in its core automotive business for the first quarter, implemented extensive layoffs, and abandoned plans to produce a low-cost family car at its Texas factory.

Reportedly, Tesla is scheduled to announce its second-quarter financial results on July 23, with automotive gross margins expected to be a key focus. Since last year, Tesla has been offering significant discounts and incentives to attract customers to its existing lineup, including the Model 3 sedans, Model Y crossovers, Model S sedans, and Model X SUVs.

In addition to the upcoming earnings report, analysts at Cantor Fitzgerald anticipate a marketing event, Tesla’s Robotaxi Day, early next month to be a potential catalyst for the stock. They expect the Robotaxi, or Cybercab, to be unveiled on August 8, though they do not foresee this segment launching before 2027.

Nonetheless, they believe it will become a significant business segment for Tesla in the long run. Cantor Fitzgerald maintains a price target of 230 dollars for Tesla and recommends buying the stock, although they predict the company will deliver fewer cars this year compared to last.

Despite its recent rebound, Tesla is trailing the broader market for the year. The Nasdaq is up 22 percent in 2024, and the S&P 500 has gained 17 percent, while Tesla is now up just 1.2 percent.

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