Canaccord Genuity raises Tesla stock target, sees above-consensus 2024 deliveries

Canaccord Genuity analysts have raised their price target for Tesla (NASDAQ:TSLA), and revised their delivery estimates for the upcoming quarter and the 2024 fiscal year.

Maintaining its Buy rating on the stock, the investment bank lifted its price target from $222 to $267, implying a 50% upside potential from the last closing price.

“Over the last several weeks, we have dramatically improved our global Tesla delivery tracking,” Canaccord said in the note. “After tirelessly scouring the web for country-level delivery data, we have gleaned some meaningful insights into 2Q24 deliveries,” adding its database spans roughly 40 countries.

Canaccord analysts trimmed their Q2 2024 delivery estimates from around 461,100 vehicles to 429,000 vehicles, which is below the FactSet consensus of 445,000. Analysts said the downward revision reflects the bank’s recent data mining.

“It's important to note we estimate June month trends by country. June is typically the highest sales month in the quarter; we do consider that seasonality in our estimates,” they wrote.

For the full year 2024, Canaccord has adjusted its delivery estimates to approximately 1.86 million vehicles, reflecting a 3% year-over-year growth. This revision is down from their previous estimate of 1.93 million vehicles but still above the FactSet consensus of 1.84 million.

Analysts said they expect Tesla’s 2024 deliveries to grow year-over-year due to bullish comments by CEO Elon Musk during the Q1 2024 earnings call “and the potential for new models to be introduced late in 2024.”

Geographically, Canaccord noted varying trends in Tesla's major markets. In China, deliveries show strength with May 2024 deliveries growing ~31% year-over-year to ~55.8k, offsetting April's tepid ~31.4k. Analysts expect this trend “to persist into June,” with Q2 2024 China deliveries estimated at 157,800 vehicles, reflecting 19.1% sequential growth.

Conversely, Europe shows weakness, with a 24% sequential decline in April+May deliveries, leading to an estimated 71,600 Q2 deliveries, marking a 14.1% sequential and 23.1% annual decline.

North America presents a mixed picture, with Q2 2024 U.S. deliveries estimated at 155,100 vehicles, reflecting a sequential rebound from Q1 but an annual decline.

“Our view is informed by Model Y inventories, Model 3 production constraints, and the Cybertruck ramp,” analysts added.