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Tuesday’s analyst upgrades and downgrades Add to ...

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Inside the Market’s roundup of some of today’s key analyst actions

Expecting it to dominate the electric vehicle market for the next decade, Berenberg analyst Alexander Haissl upgraded Tesla Inc. (TSLA-Q) to “buy” from “hold.”

Touting the company’s “disruptive potential,” Mr. Haissl pointed to the “complacency” of traditional auto makers toward EV technology and discounting the threat from original equipment manufacturers.

"With no clear pathway to high-volume EV production for these OEMs  before the mid-2020s, Tesla will be given a near-monopolistic opportunity to gain market share and outcompete the incumbent automotive industry,” he said.

Mr. Haissl raised his price target for Tesla shares to $464 (U.S.) from $193. The analyst average price target is $299.94, according to Bloomberg data.

“Once the business reaches scale, the cash generation potential is significantly superior to existing premium OEMs with cash flow per vehicle more than 50 per cent higher,” he said. “For traditional OEMs, more drastic measures to create shareholder value may need to be considered – including, for example, spinning out their EV divisions to better focus on technology development and improve capital allocation. However, this would first require a transition to dedicated production lines rather than integrated production.”
 

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