Tesla shares soared 19.9% on Monday after Argus Research raised its price target to $808 from $556 – the biggest one-day jump for the company since May 2013.
The firm’s analysts cited Tesla’s strong fourth-quarter financials, which exceeded Wall Street’s expectations last week. It also raised its earnings per share estimate to $8.01 from $5.96 and expects that to double by 2021. Tesla’s market cup currently stands at just over $140 billion.
“Our positive view assumes continued revenue growth from the legacy Model S and Model X, as well as strong demand for the new Model 3, which accounted for more than 80% of 4Q19 production,” according to the research note.
The company had sold 2,550 Model 3 cars and 19,450 Model S and X vehicles during the fourth quarter. It was also expected to deliver 87,900 Model 3, 9,800 Model S and 9,300 Model X vehicles.
“Despite past production delays, parts shortages, labor cost overruns and other difficulties, we expect Tesla to benefit from its dominant position in the electric vehicle industry and to improve performance in 2020 and beyond,” the note added.