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Tesla Hits Record High For 2023 In Premarket: What’s Happening?

Shares of electric vehicle giant Tesla, Inc. rose in premarket trading, extending the growth seen since the middle of May.

Shares of electric vehicle giant Tesla, Inc. (NASDAQ:TSLA) rose in premarket trading, extending the upward momentum seen since the middle of May.

If the sentiment seen in the premarket is sustained through the session, the stock could extend its winning streak to a ninth straight session.

Tesla Model Y vehicles sit on the lot for sale at a Tesla car dealership on May 31, 2023, in Austin, Texas. Tesla’s Model Y has become the world’s best-selling car in the first quarter of 2023. BRANDON BELL/BENZINGA

Some of the buoyancy seen in the stock is attributable to the broader market strength achieved on the back of the enactment of the budget deal that averted a potential economic catastrophe and expectations that the Federal Reserve would pause when it meets next week.

The stock is currently trading below the average analysts’ price target of $199, compiled by TipRanks. Traders expect sell-side firms to raise their price targets for Tesla in the coming days, citing the stock overshooting their price objective.

Fundamentally, not much has changed as demand for its vehicles has not taken off despite the company’s aggressive price cuts.

That said, investors are excited by the company’s Cybertruck launch, likely in the fourth quarter, and the Model 3 refresh.

The Cybertruck is expected to be a big hit for Tesla as it will compete with other EV trucks in the market that includes the Ford F-150 Lightning, Rivian R1T, Chevrolet Silverado EV, GMC Sierra EV, and the GMC HummerEV truck. Though production timelines have been delayed several times, it is now expected to be officially released in September of this year.

Tesla co-founder and CEO Elon Musk introduces the newly unveiled all-electric battery-powered Tesla Cybertruck at Tesla Design Center in Hawthorne, California (Photo by FREDERIC J. BROWN/AFP via Getty Images)

Some of the other factors that may have served to calm the nerves of investors are CEO Elon Musk handing over the reins to someone else at Twitter and also his recent China visit.

“Tesla, many people think is an auto stock. We don’t, we think it’s much more than that,” said ARK Investments CEO Cathie Wood.

In the first quarter, Tesla slashed its prices for the Model 3, which recorded a profit loss as it pressured on its competitors to lower its prices.

The Model 3 is Tesla’s best-selling vehicle along with the Model Y.

Produced in association with Benzinga

Edited by Alberto Arellano and Jessi Rexroad Shull

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