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April 6, 2021

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Tesla shares surge 8% in early trade on deliveries

Source: Agencies | 00:00 UTC+8 April 6, 2021 | Print Edition

TESLA Inc was set to add about US$50 billion to its market value, as its shares surged yesterday after the world’s most valuable automaker posted record deliveries, overcoming the impact of a shortage of auto chips that has slammed the entire sector.

The carmaker’s shares, up nearly 8 percent in pre-market trading, were on track to hit their highest in over a month.

The electric-car maker said on Friday it was encouraged by the strong reception of its Model Y crossover in China and it was quickly progressing to full production capacity.

Tesla’s ability to produce roughly the same amount of vehicles in the first quarter as in the fourth quarter “stands out relative to the trend in global light vehicle production,” JP Morgan analysts said.

Chief Executive Officer Elon Musk’s personal wealth has been boosted by more than an eight-fold surge in the stock’s value last year, even though its production is a fraction of rivals such as Toyota Motor, Volkswagen and General Motors.

Brokerage Wedbush made the most aggressive move by hiking its target by US$50 to US$1,000, much higher than the median price target of US$712.50, as per Refinitiv data. Tesla delivered 184,800 vehicles globally during the first quarter, above estimates of 177,822 vehicles.

Tesla’s shares were at US$713 before the bell, while other EV makers, including NIO Inc, Workhorse Group and Xpeng Inc were up about 3 percent.

“The (EV) sector looks primed to resume its march higher, considering the surging demand for EVs in China, Europe, and the US. Tesla’s delivery numbers could be the spark needed to jumpstart the next rally,” said Jesse Cohen, senior analyst at Investing.com.

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