‘That’s assuming they do 10 million cars, and that’s without the battery business, just on the car business… ’
Investment manager Ron Baron waxed very bullish on Tesla Inc.’s stock TSLA, +14.99% on Tuesday during an interview on CNBC, even as the electric-vehicle maker has staged a spectacular share surge recently, highlighted by double-digit% rally on Tuesday.
Baron’s reiterated a prediction made two years ago that Tesla has the “potential for $1 trillion in revenues within 10 years.”
The billionaire investor explained on the business network that the vehicle maker is just getting started and could see its value balloon if it manages to sell cars at a more rapid clip.
The Silicon Valley auto maker’s shares set a goal to “comfortably” sell more than 500,000 vehicles in 2020 after reporting quarterly results that handily topped consensus analysts’ expectations.
For the fourth quarter, the company delivered 367,500 vehicles in 2019, up 50% from a year ago — in line with its guidance range of 360,000 to 400,000 vehicles.
“So basically you looking at the very start of what’s going to happen with Tesla,” Baron told CNBC.
Meanwhile, Tesla’s shares have climbed 102% in the past 30 days, and have rallied more than 180% over the past 30 days, according to FactSet data. That performance far surpasses gains for the Dow Jones Industrial Average DJIA, +1.52% and the S&P 500 index SPX, +1.47% , which are up 4.9% and 6.9%, respectively, over in the past three months. The Nasdaq Composite Index COMP, +1.62%, meanwhile, has climbed 4.1% in the month and 11.4% in the past three months.
Baron said that his estimates don’t even factor revenue from Tesla’s battery business and other endeavors.
Further gains for Tesla’s shares come a day after ARK Invests chief investment officer, Catherine Wood, upgraded her outlook for Tesla, saying it now expects the stock to be worth $7,000 by 2024 — and that’s the base case. In a bull case, Tesla shares would trade at, or above, $15,000.
Check out Ron Baron’s CNBC interview: