Magnificent 7 series: What will the Tesla (TSLA) stock price be worth in 2030?

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on Jun 7, 2024
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  • Predicting stock prices in the longer-term is an imprecise business - yet it's also important for investors.
  • In this series, we look at each Magnificent 7 stock and look at what each may be worth by 2030.
  • Today we are looking at Tesla. Heading for $2000? Or stuck in a range?

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Of all the Magnificent 7 stocks, arguably none are as difficult to forecast as Tesla. The car-making AI bull company has had some wild price swings and significant volatility in the past decade that has been both exhilarating and nail-biting for investors.

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It’s also the Magnificent 7 stock that has seen the most falls recently, by far. This year to date, Tesla’s stock price is down by more than 28% this year to date, sitting at around $177.94 at the time of this article going to press.

However, in the past five years in total, Tesla stock has appreciated a massive amount, rising close to $165, around 1200%.  

Does this mean that it’s possible Tesla will rise by another 1200% within the next five years to reach a share price of $2135?

Given the recent trajectory of the stock, it seems unlikely. Tesla remains down more than 50% from its all-time high of over $400 currently, and is showing no signs of imminently picking up again.

The shorter-term view

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In the near term, Invezz analyst Ritesh A says he doesn’t see Tesla’s current downtrend ending soon, saying that:

Unless Tesla’s stock closes above $265 for four consecutive weeks, it cannot be conclusively said that the long-term downtrend has ended. Conversely, if the stock falls below $115 again, it will be detrimental to both the stock and the company. Long-term investors should watch these levels carefully and not be swayed by 10-20% moves, as Tesla remains one of the most volatile large-cap stocks in the market.”

Source:  TSLA chart by TradingView

The longer-term, AI view

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However, ARK Invest CEO Cathie Wood has a bullish, long-term view of Tesla:  

Tesla is an Artificial Intelligence company… and we think that Tesla is the biggest AI project in the world and if all of the AI stocks that are running are going to prove correct, it will be because of companies like Tesla that are going to harness AI and, in Tesla’s case, transform mobility.”

Wood here is talking about the secular shift, over many long years, from traditional motor vehicles to ones like electric vehicles and particularly autonomous, self-driving vehicles powered by AI.

In fact, in an April CNBC interview, Wood said that she expects Tesla’s stock price to hit $2000 per share by 2030.

What Invezz analysts say

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However, “despite the excitement around diversifying into other products and platforms, Tesla is still fundamentally a car company,” says Ritesh A. “And, like all car companies, its margins have shrunk over the years.”

He goes on to say that:

Additionally, Tesla’s stock is linked to lithium prices. While lower lithium prices help companies since batteries make up around 60% of the production costs of an EV, they benefit Tesla’s competitors, like Chinese EV car company BYD, more than Tesla.”

Tesla range-bound?

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“Given these factors, I expect Tesla’s stock to stay within a certain range for a long time,” says Ritesh.

Ritesh draws a parallel between Tesla today and how Cisco Systems Inc (NASDAQ: CSCO) performed during and after the Dotcom bubble. 

From early 1995 to March 2000, Cisco’s shares soared by 4,000%, reaching a market capitalization of over $555 billion. However, over the next two years, its share price plummeted by more than 80%, losing over $430 billion in market capitalization as the bubble burst.

We’ve seen something similar with Tesla’s stock. It surged eighteenfold between March 2020 and November 2021, but after peaking at $414.50 in November 2021, the stock fell by over 75%, hitting a low of $101.81 in January 2023. 

Similarly, Cisco’s stock rebounded after its October 2002 low but has yet to surpass its Dotcom-era high, even after more than two decades.

“Although I don’t expect Tesla to follow the same path and remain below its November 2021 high for the next two decades, I do anticipate the stock staying range-bound for several years, likely until 2030, unless another mania like the GameStop episode pushes it higher without any solid fundamental basis,” said Ritesh.

Technical analysis of Tesla stock

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This phenomenon is evident in the charts, where Tesla’s stock entered a long-term downtrend after its November 2021 high. It found support near the 78.6% Fibonacci retracement at $115 in January 2023, bounced back, and faced resistance near the 38.2% Fibonacci retracement at $265 in January 2023 before reversing course again.

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