Tesla Stock May Hit $420 Per Share, Says Stock Technician
Is this just the pullback before the pop?
The debate over the future of electric car company Tesla continued this week, as new board chair Robyn Denholm took over for Elon Musk, the result of a settlement with the federal government that had stock analysts split on whether Denholm’s promotion signaled good or bad news for Tesla. Meanwhile, a stock expert told CNBC Thursday that one part of a tweet that caught the SEC’s attention to begin with might come true relatively soon: Tesla stock could hit $420 per share.
This week, Todd Gordon of TradingAnalysis.com, appeared on the financial cable network (clip above) to say that Musk’s $420 per share tweet may actually come to pass, except that it may come as a result of a rising stock price, not the company going private. After the markets closed on Friday, Tesla stock was valued at $350.51 per share. Watch the full segment on CNBC.
Gordon noted that three previous dips in Tesla’s stock took about a third of its value each time. The first dip was related to the Model X delays in early 2016; the second sell-off was from Model 3 production delays in the fall of 2017, and the third dip, in September, was from Musk’s “funding secured” tweet. Factoring in the rise in stock price after those dips, Gordon still forecasts the stock hitting $420 per share at its next high point.
“I think if we hold the bid, and I think we will, the $389 high is in jeopardy and we should be able to get up to Elon’s $420 on the breakout,” Gordon said. “I’m going to try to play this on the long side, I like the look of the chart.”
In August, Elon Musk posted on Twitter the now-infamous “funding secured” comment that he was planning on taking Tesla — which became a publicly traded company in June 29, 2010 at $17 per share — back to privately held status. Musk said he had enough financial backing to do so, a price of $420 per share. People could sell out or hold and go private with the company, he said.
The SEC sued Musk over suspicion that Musk might’ve been trying to artificially inflate the stock price. It took a phone call from Mark Cuban, but Musk eventually decided to settle the suit from the federal government instead of taking up what might’ve been a years-long court battle. Musk later said that Tesla wouldn’t go private.
Sign up for Musk Reads, a weekly email that aggregates only the essential news about Elon Musk’s projects. Sent on Wednesdays.