TLDR
- Tesla stock showing similar technical patterns to March 2020 before major rally
- Currently at “value zone” with single-digit price-to-sales ratio
- Upcoming robotaxi launch in Austin this summer could be catalyst
- Wedbush analyst Dan Ives has $550 price target despite recent 25% drop
- Ives predicts Tesla could reach $2 trillion valuation, largely driven by AI and autonomous driving
Tesla’s stock has been on a rollercoaster ride over the past year, trading between $142 and $480 per share. The electric vehicle maker now shows technical patterns similar to March 2020, just before a massive rally that saw shares soar over 1,000% in less than a year.
Recent price action has driven the stock down about 25% from December highs. This has placed Tesla shares back in what some analysts call a “value zone.”
The current market capitalization sits just under $950 billion. This represents a significant discount from Wedbush analyst Dan Ives’ price target of $550 per share.
Ives remains bullish despite investor concerns about CEO Elon Musk’s divided attention. Musk recently joined former President Donald Trump’s Department of Government Efficiency (DOGE) initiative.
The analyst believes Tesla has competent management in place. He argues this should allow the company to continue executing even with Musk’s attention spread across multiple ventures.
Looking at the technical analysis, Tesla’s chart shows striking similarities to March 2020. During that period, the stock experienced a strong uptrend ending in a climactic move.
This was followed by three waves of selling. The decline amounted to roughly 50% in a short time frame.
The pattern included seven straight red sessions. It culminated with the stock touching its 200-day moving average.
After hitting that technical level in 2020, Tesla shares rocketed from approximately $23 to $294 by January 2021. That’s an increase of over 1,100% in less than a year.
The valuation metrics also show similarities. In both 2020 and late 2024, Tesla’s price-to-sales ratio dipped into single digits.
Another parallel exists in Tesla’s product cycle. In 2020, the company was preparing to launch the Model Y, which later became the world’s best-selling car.
Now, Tesla is preparing to launch its robotaxi service in Austin, Texas this summer. Musk has stated he’s willing to “bet the company” on this autonomous driving initiative.
This robotaxi service represents Tesla’s first commercial deployment of fully autonomous driving. The launch could mark a major milestone in the company’s evolution beyond traditional vehicle manufacturing.
Analyst believes Tesla could eventually reach a $2 trillion valuation
Ives believes Tesla could eventually reach a $2 trillion valuation. This projection doesn’t even include potential value from the company’s robotics division.
The analyst sees multiple growth drivers. These include Tesla’s upcoming lower-priced EV model, autonomous driving technology, and leadership in artificial intelligence.
For traders looking at historical precedents, the current setup suggests a potentially favorable risk-reward scenario. This view assumes Tesla can execute on its upcoming product launches.
Legendary investor Paul Tudor Jones used similar pattern recognition to predict the 1987 stock market crash. He studied market history, recognized excessive speculation, and used technical analysis to identify the opportunity.
While past performance doesn’t guarantee future results, some investors see Tesla’s current technical and fundamental setup as increasingly attractive at current price levels.
The stock currently trades around $300 per share. This represents a potential upside of over 80% to reach Ives’ price target of $550.
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