Tesla Record Deliveries Show Price Cuts Were a 'Smart Poker Move': Ives
Tesla's price cuts were a "smart poker move" given the EV carmaker has smashed it with record 2Q deliveries, Wedbush's Dan Ives said.
He added the strong numbers "will send the Tesla bears back into hibernation mode."
Tesla has been slashing the price of its vehicles since the start of the year to boost waning demand.
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Tesla's record EV deliveries in the second quarter show its price cuts were a "smart poker move" that will ultimately silence company bears, Wedbush analyst Dan Ives said.
Elon Musk's company delivered 466,140 cars globally over the last three months, beating Wall Street estimates. According to Bloomberg, analysts anticipated Tesla to deliver 448,350 cars.
"This was a massive delivery beat and will send the Tesla bears back into hibernation mode. The price cuts was a smart poker move for Tesla and paying major dividends in the field, especially for the China market. This was a trophy case quarter for Musk & Co," Ives said in a tweet on Sunday.
Against that backdrop, Ives maintained a $300 price target for Tesla stock. Following the release of the strong 2Q delivery numbers, Tesla's stock rose 7.49% to $281.50 a share on Monday.
Tesla embarked on an aggressive price cutting strategy for its vehicles this year, slashing costs of Tesla models six times since the start of 2023. The move was aimed at boosting demand that was hit by a slowdown in China following years of COVID-19 lockdowns, and high levels of global inflation.
The cuts are clearly working, with deliveries up for the second quarter in a row. In the first three months of the year, Tesla's deliveries rose 36%.
Ives' current optimism for Tesla stands in contrast to the analyst's hesitation earlier this year about the company's price cuts, when he highlighted that Tesla is weathering an erosion of margins in order to prop up sales volumes.
Source: Markets Insider
