Tesla (TSLA) Shares Can Reclaim $250 by Spring - Morgan Stanley

Shares of Tesla Motors (NASDAQ: TSLA) are modestly higher early Tuesday following positive comments from Morgan Stanley analyst Adam Jonas. The analyst believes the stock can reclaim $250 by spring.

"We expect a pivot in newsflow and outlook for Tesla on several fundamental fronts, triggering a recovery in the share price from recent lows," he said. "Sentiment sits with just the right amount of concern, doubt and opportunity, creating a healthy balance."

He added, "A strong US$ and low oil price have teamed up against TSLA shares, providing a classic opportunity to increase exposure to what we see as the world’s most important auto company - much more important than just its role as an EV manufacture. Specifically, we identify 4 vectors which we think will turn the tide:

1. Re-acceleration of order activity globally. "Serious questions have been raised in recent months on end-market demand for the Model S both domestically and in key international markets, particularly China.While 4Q will show a chicane on the trajectory, we expect company commentary and the customer deposit balance to suggest demand is actually stronger than ever. Specifically, we expect the Model D’s enhanced performance attributes to help both volume and transaction price.The cars are getting better...and more fun."

2. Positive results from early battery prototype production. "While the ability to mass produce cells with full automation in Nevada may not be possible before 2017, we anticipate Tesla to be in position to share some results of the prototyping of the design well ahead of that..."

3. Re-affirmation of Model X launch timing and upcoming performance details "After some bit of slippage, we expect thecompany to reaffirm a 3Q Model X launch window… WITH FALCON DOORS..."

4: Our $280 price target offers more than 30% upside from the current share price.

The firm maintained an Overweight rating and price target of $280 on TSLA.

For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.

Shares of Tesla Motors closed at $210.94 yesterday.

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