Tesla stock jumped Monday after six consecutive losses, as excitement around the Cybertruck and an upgraded Model 3 vehicle in China seems to be growing.
TSLA jumped 7.3% to 231.27 in Monday market trade after Baird analyst Ben Kallo outlined several catalysts for the stock in the second half of the year.
Kallo wrote Monday that vehicle price cuts and pressure on Tesla's gross margins will continue to be the main story for the global EV giant. However, Kallo added TSLA could be propelled higher by the Cybertruck launch — expected to be in Q3 — and other factors. Baird maintains an outperform rating on TSLA with a 300 price target, 39% above where shares are currently trading.
Numerous sightings of Cybertrucks on roads in the U.S. is fueling excitement online around the expected vehicle release. Social media users also recently spotted a Cybertruck in Iceland, in what appears to be a promotional video.
Tesla is also set to release its updated Model 3, code-named Highland, in China. Some stores are already taking reservations, according to local reports. Late last week, Bloomberg reported mass production of the new Model 3 is expected to begin in September.
Tesla Stock Action
TSLA stock has been pulling back since reporting second-quarter financials on July 19. Investor concerns over falling gross margins outweighed the global EV giant's above-forecast earnings and revenue. News of sales from Cathie Wood's ARK Invest ETFs may also have fueled some downside momentum.
Tesla stock declined more than 11% to 215.49 last week on the back of six consecutive losses. Shares are still above their 200-day moving average. TSLA is now at its lowest since it closed at 213.97 on June 2. Two weeks ago, Tesla stock undercut support at the stock's 50-day, 10-week moving average. TSLA finished that week more than 2% below the 10-week line, which is a clear sell signal, according to IBD analysis.
While Tesla stock has plummeted nearly 20% in August, on Wednesday, Wedbush analyst Daniel Ives, a longtime Tesla bull, told CNBC he remains "firmly bullish."
"I view this more as a sell-off post-quarter, worries about China," Ives said. The analyst added he views this "as an opportunity" and that Tesla is a "table pounder at these levels."
Tesla stock ranks fourth in IBD's automaker industry group. It has a 91 Composite Rating out of 99. Tesla stock has a 79 Relative Strength Rating and its EPS Rating is 94 out of 99.
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