Tesla (TSLA) remained the most active stock in thin Thursday trading, with prices indicating the strongest two-day advance in more than six months, after CEO Elon Musk acknowledged what is likely to be the worst annual performance for the carmaker's stock on record this year.
Musk told employees late Wednesday to ignore "stock market craziness" and focus on deliveries over the final few days of the quarter, stressing the need to "go all out for the next few days and volunteer to help deliver if at all possible, It will make a real difference."
"Btw, don't be too bothered by stock market craziness. As we demonstrate continued excellent performance, the market will recognize that," Musk said. "Long-term, I believe very much that Tesla will be the most valuable company on Earth!"
Tesla will publish its fourth quarter delivery figures likely within the first two days of January, with analysts looking for a record tally of around 435,000 to 450,000 units.
The group's detailed fourth quarter earnings are expected on January 25, with forecasts pointing to an adjusted bottom line of $1.24 per share on revenues of $25.5 billion
Tesla shares, which are down nearly 70% so far this year, were marked 8.08% higher by the end of Wednesday trading to close at $121.82 each.
Late Wednesday, Morgan Stanley analyst Adam Jonas reiterated his 'overweight' rating on Tesla stock, but slashed $80 from his price target to a new level of $250 per share.
Jonas noted the group "may be in position to extend its lead vs. the EV competition (next year) even before consideration of Inflation Reduction Act benefits where Tesla also stands out as the biggest potential winner.
Portions of the IRA will allow buyers of Tesla Model 3 and Model Y sedans to reclaim a portion of their purchase price, up to $7,500 dollars, in federal tax credits.
"Within this environment, we believe players that are self-funded, with demonstrated scale and cost leadership throughout the value chain can be relative winners," Jonas said.
The outlook echoes a similar bullish thesis from Baird analyst Ben Kallo, who lowered his price target on Tesla shares by around 11.5%, to $252 per share, but noted the company remains one of its "best ideas" for 2023 and held on to its 'outperform' rating.
Kallo said Tesla has "“many demand levers to pull including an increase in vehicle leasing and additional supercharging incentives” that could offset weakness in China, where a weeklong shutdown in production at its Shanghai factory rattled investors.
Short interest in Tesla shares remains elevated, however, with bets around the group pegged at around $12.4 billion, according to recent data from S3 Partners, a figure that represents around 2.72% of the group's outstanding shares.
