- Tesla shares soared as much as 20% in early Tuesday trading, continuing to tear higher after a nearly 20% gain on Monday.
- The jump brings Tesla shares to a new high and pushes their price above $800 for the first time.
- The automaker has enjoyed massive gains in 2020, fueled by a blockbuster fourth-quarter report, numerous analyst upgrades, and thwarted short-sellers.
- Monday's jump marked Tesla's biggest single-day gain since 2013.
- Watch Tesla trade live here.
It's record-after-record for Tesla's stock price, and analysts are struggling to keep up.
Tesla shares jumped as much as 20% in early Tuesday trading, extending the company's gains after a 19.9% surge on Monday. The increase brings Tesla to a new all-time high and pushes its share price above $800 for the first time.
Monday's leap was partially fueled by Argus Research analyst Bill Selesky, who raised his price target to a Wall Street-high of $808 from $556 and maintained his "buy" rating on strong demand for the Model 3 sedan. The analyst also expects Tesla to profit from its strong position in the electric-vehicle sector.
Selesky's price target implied a 24% gain from Friday's close, yet Tesla shares are trading well above the $808 level early Tuesday. The company's stock opened at $882.96 on Tuesday and even breached $900 per share in pre-market trading.
Monday's jump marked Tesla's biggest single-day increase in six years.
The early Tuesday spike follows a blockbuster fourth-quarter report from January 29, which saw the automaker boast a second consecutive quarter of profitability and accelerate the rollout for its Model Y crossover. Tesla also beat expectations for both profit and revenue, and projected 2020 sales would "comfortably exceed" 500,000 vehicles.
While Tesla bulls have enjoyed the seemingly endless run-up in 2020, short-sellers are facing intense pressure to cover their positions. Traders betting against the automaker were down $2.5 billion in mark-to-market losses on Monday, according to a note from financial-analytics firm S3 Partners. The Monday surge brought shorts' year-to-date losses to a $8.31 billion.
Short-sellers often exit their positions when a soaring stock drives massive losses, a move commonly known as a "short-squeeze." A mass exodus of Tesla bears could drive the stock even higher in the near term, but S3 managing director Ihor Dusaniwsky thinks short-sellers won't be so quick to turn away.
"While we are seeing some momentum short sellers increasing their positions in anticipation of a short-term pullback, we should see an increase of short covering due to this $700/share level squeeze," Dusaniwsky said.
Tesla closed at $780 per share on Monday, up 88% year-to-date.
The company has nine "buy" ratings, 10 "hold" ratings, and 18 "sell" ratings, with a consensus price target of $466.78, according to Bloomberg data.
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