Striking Parallels in Tesla’s Stock Performance: A Glimpse Into 2025 Potential
Managing partner at The Future Fund LLC, Gary Black, recently drew attention to the intriguing similarities between Tesla Inc’s stock performance in 2019 and the outlook for 2025, urging caution to short sellers.
Reflecting on the Past and Looking to the Future
In 2019, Tesla was on the brink of launching the Model Y, a moment that parallels the company’s current endeavors in introducing new vehicles, including more accessible models, set for production commencement in the first half of 2025.
Back in 2019, skeptics of Tesla were apprehensive about the Model Y’s potential impact, mistakenly assuming it to be nothing but a larger version of the Model 3. However, as history has shown, Model Y propelled Tesla to the top spot in the hot-selling CUV category, swiftly becoming the best-selling vehicle for the company.
Fast forward to 2025, where Gary Black envisions the new affordable model from Tesla expanding the company’s total addressable market, mirroring the success story of the Model Y.
Anticipated Upward Momentum in 2025
Black predicts that Tesla’s forthcoming affordable model will not cannibalize the Model 3 but tap into a new segment, much like the Model Y did, resulting in strong demand and surpassing of earnings estimates. This trend could potentially push the stock price to new heights, akin to the events of 2020 when the Model Y launch drove Tesla’s stock surge.
Black’s analysis suggests that the positive earnings revisions resulting from the introduction of the new affordable Tesla model could echo the stock price surge observed in 2020.
Significance of the Affordable Vehicle
Tesla’s announcement during the second-quarter earnings report that the new affordable vehicle can be produced using existing manufacturing lines highlights the company’s efficiency. Although details like pricing are yet to be disclosed, Black estimates a price range of $25,000 to $30,000, positioning the new model as a cost-effective alternative.
For context, the current cheapest offering from Tesla, the Model 3, starts at $38,990 in the U.S.
As of the latest market close, Tesla’s stock stood at $238.25, registering a 2.3% decline. Year-to-date, the stock has faced a 4% decrease, according to data from Benzinga Pro.
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