Tesla Stock Price Projected at $2600 in 2029
Robo-taxi Profitability Improvement Drives 90% of Corporate Value
Shares of American electric vehicle company Tesla are projected to soar up to 15 times in five years. Elon Musk, Tesla's CEO, is expected to secure high profitability with his ambitious project, the 'Robotaxi.'
ARK Investment, led by American investor Cathie Wood, presented a target price of $2,600 per share for Tesla in 2029 in a report released on the 12th (local time). This represents about 15 times the previous day's closing price of $170.66. Additionally, ARK set Tesla's 2029 target price at $2,000 in the 'bear case' and $3,100 in the 'bull case.'
The driving force behind this stock price increase was identified as the Robotaxi business. It is analyzed that about 90% of Tesla's corporate value and profits in 2029 will be generated from the Robotaxi business. On the other hand, the electric vehicle segment is expected to account for about one-quarter of Tesla's total sales and about 10% of its profits.
ARK Investment explained, "If Tesla did not have the Robotaxi business and network, the target stock price would be $350 per share," adding, "We believe the Robotaxi service will be launched within the next five years and will generate much higher margins." Tesla is scheduled to release its Q2 earnings in mid-next month and unveil the Robotaxi on August 8.
Cathie Wood, known as the 'Money Tree Sister,' gained market attention by achieving record returns through technology stock-focused investments, including Tesla, during the COVID-19 pandemic. ARK Investment's flagship exchange-traded fund (ETF) holds approximately $695 million (about 950 billion KRW) worth of Tesla shares as of the previous day's closing price, with Tesla accounting for 11.09% of its holdings, ranking first among its portfolio.
CEO Musk responded on X (formerly Twitter) that the task is "extremely challenging but achievable." On the same day, Tesla's stock closed at $177.29, up 3.88% from the previous session on the New York Stock Exchange. However, it has fallen about 28% since the beginning of this year.
Meanwhile, negative news for Tesla also emerged on the day. The European Union (EU) announced plans to raise tariffs from the current 10% to an average of 21%, citing that Chinese electric vehicles receive excessive subsidies that distort market competition. This is expected to inevitably impact Tesla as well, which produces products in Chinese factories and exports them to Europe. However, a senior EU Commission official explained that only a provisional conclusion has been reached so far, and additional investigations will be conducted based on materials submitted by Tesla, allowing for individual tariff reductions.
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