Tesla (TSLA) PT Raised to $290 at RBC Capital Following Stock Split

RBC Capital analyst Joseph Spak raised the price target on Tesla (NASDAQ: TSLA) to $290.00 (from $190.00) while maintaining a Underperform rating.

The analyst comments "When we look at Tesla in our simple two-stage model to try to understand embedded expectations (using a 7% discount rate, 4% terminal growth rate) to justify current levels (never mind future appreciation), Tesla would need to grow FCF at a ~36% CAGR for 10-yrs. Our screen of companies that started with $1bn in FCF and were able to grow FCF at a >30% 10- yr CAGR is a list of 3: AAPL, AMZN, GOOG. We believe it will be harder for TSLA to achieve this given they are a manufacturer that operates in a more cyclical industry."

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