Tesla (TSLA) Equity Raise is a Good Move, Solidifies Wedbush's Bull Case
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Wedbush analyst Daniel Ives reiterated a Neutral rating and $560.00 price target on Tesla (NASDAQ: TSLA) after the company announced it has entered into an equity distribution agreement for up to $5 billion to strengthen its balance sheet. This is in addition to the $5 billion raise from September and additional equity raises to build up its Cap Ex capabilities down the road.
The analyst stated "We believe this is the smart move at the right time for Musk & Co. after the parabolic rally in shares with the appetite strong among investors to play the transformational EV trend through pure play Tesla over the coming years. In one of its most important and strategic moves in the last decade, Tesla raised significant capital over the past year that initially took the doomsday scenario off the table that Tesla was facing at the time and ultimately helped them navigate the build-out of the linchpin Giga 3 factory in China and enough time for the model to hit sustained profitability which also earned them S&P 500 inclusion." He went on to state "We believe this capital raise is a clear positive and further solidifies our bull case price target scenario of $1,000 with our base target $560".
Shares of Tesla closed at $629.99 yesterday.
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