CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

How will Tesla share price fare once China-made Model 3 hits the road?

The electric car marker’s share price could potentially rally around 50% in the coming months, according to Morgan Stanley analysts.

US electric car manufacturer Tesla, Inc. (NASDAQ: TSLA) has qualified for subsidies from the Chinese government for a new batch of locally-made cars due for delivery in late-January.

Two versions of the Tesla Model 3 sedan have been placed on the Ministry of Industry and Information Technology’s recommendation list for new energy vehicle subsidy, Reuters had reported.

Buyers will receive a subsidy of up to 25,000 yuan (US$3,550) for the purchase of each car. This represents a discount of around seven percent from the proposed sale price of US$50,000.

Practise trading US stocks with an IG demo account now

Stock value up 4.4% in 2019 alone

Following the news, IG figures showed that Tesla’s share price surged at least 0.74% on Friday 06 December to close the week at US$335.27 per share.

This latest update comes hot on the heels of the new Cybertruck model’s recent launch in the US. Demand for the fully stainless-steel car, unveiled last month, is already through the roof, even though production is slated to start in 2021.

According to CEO and founder Elon Musk, the Cybertruck had received 250,000 initial deposits as of 27 November.

In terms of 12-monthly share price, Tesla stocks have risen roughly 4.4% in value since the start of this year.

Analyst: Share price to skyrocket

On the back of these developments, a team of Morgan Stanley analysts have stated that there is a possibility share price could become even more bullish in the coming months.

‘We raise our bull case to $500 to account for the newly unveiled Cybertruck, and a more optimistic scenario in China,’ Morgan Stanley shared in a media note.

They further estimated that sales of the Cybertruck could hit 100,000 units by 2024.

However, the analysts clarified that these figures are a best-case scenario.

‘To be clear, we are not bullish on Tesla longer term, especially as, over time, we believe Tesla could be perceived by the market more and more like a traditional auto original equipment manufacturer,’ they said, adding that the original base price target of US$250 remains unchanged.

Lead analyst Adam Jones also noted that investors should probably tread with some level of caution, since US-China trade negotiations are still ongoing.

Tesla shares closed at US$341.26 on Monday 09 December.

Practise trading US stocks with an IG demo account now

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

Act on share opportunities today

Go long or short on thousands of international stocks with CFDs.

  • Get full exposure for a comparatively small deposit
  • Trade on spreads from just 0.1%
  • Get greater order book visibility with direct market access

See opportunity on a stock?

Try a risk-free trade in your demo account, and see whether you’re on to something.

  • Log in to your demo
  • Try a risk-free trade
  • See whether your hunch pays off

See opportunity on a stock?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Trade a huge range of popular stocks
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See opportunity on a stock?

Don’t miss your chance. Log in to take advantage while conditions prevail.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Friday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.