I Tesla (NASDAQ:TSLA) share price has been going crazy lately, hasn't it? As I peer into my crystal ball for 2024, there's a lot to look for from potential investors in this EV powerhouse. Let's take a closer look.
Another wild year
The average analyst thinks Tesla's share price will reach $211.46 in the next 12 months. Be aware, there is a spread of ideas. The pessimists penciled in $85 and the optimists shot for $310. It is worth noting that at around $211.75, the current share price is in line with the average forecast. So has the market already got it right?
Looking ahead to the end of 2024, I think there is a good chance that stocks could go higher. As production increases in new factories around the world, those significant profit opportunities should increase.
CEO Elon Musk's focus on AI and robotics has the potential to redefine the future of the company. He often urges investors to look at the company not just as a car company but as an AI-robotics company.
Executives expect to have robotaxis on the road next year. It also intends to produce several thousand of its new robots for domestic use.
However, as promising as these new approaches are, their timeline for generating profit is still uncertain. Executives have a history of missed deadlines, such as the Cybertruck launch delay. This serves as a reminder that investors should always temper expectations.
Within the EV sector, competition is clearly intensifying, as traditional automakers and plucky upstarts get busy. And we can't ignore the broader economic picture – if inflation and interest rates remain uncertain, people may think twice about going abroad. .
We are already seeing the results of this uncertainty. In the first quarter of 2024, deliveries fell 8.5% year-on-year – the first such decline since 2020 – followed by a 5% contraction in the second quarter. Executives warned that vehicle volume growth in 2024 is likely to be lower than in 2023, citing efforts to launch the next-generation vehicle, macroeconomic uncertainty, and declining EV demand.
I'll also be keeping an eye on Musk's controversial comments as the US general election approaches. Many fear that his divisive views will have a negative impact on the business, as it has sent shares down at times in the past.
My best guess
If I measure everything, I think that the shares could end 2024 somewhere between $ 250 and $ 300. That would represent a clean profit of 20%-40% from current levels.
Of course, this is my best guess. This company is clearly a maverick, and its share price has been known to fold when everyone expects it to zag. The high valuation – with a price-to-earnings (P/E) ratio of 51.9 times and a price-to-sales (P/S) ratio of 6.7 times – means it will need to keep delivering to justify it. premium price tag.
It's a bumpy road
So, for those tempted by Tesla, I would always suggest preparing for a rough ride. The company has shown that it can deliver great innovations, but the market can sometimes look beyond this. Controversy and hype can make many existing or potential investors nervous. But I will hold on to my shares for a long time.
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