Tesla Shares Are Surprisingly Cheap
The current market conditions are offering a truly unique opportunity to pick up the stock of a hyping EV giant Tesla at a nearly 25% discount compared to its very recent $299.29 high of July 19. This popular asset almost tripled its value, from annual lows at the beginning of January until mid-summer. After that, a meteoric rise of Tesla prices gave way to a rapid decline or rather a correction, while most fundamentals remain strong. The method used the company in order to expand its market niche in particular regions is attracting more loyal customers by temporarily lowering prices.
Tesla done it last year in the Unites States, China and Europe and decided to do it again, in response to a clear slowdown in retail sales and industrial production indicators of the Chinese economy. Therefore, selling prices for some Tesla models were cut by 3%-4%, effective until the end of September. The company is ready to sacrifice its margins for the sake of further increasing sales numbers. Previous experience has shown this marketing techniques worked out well to increase the ultimate strength of Tesla, and there is no reason to believe that it may betray the company now.
Thus, the last few days of additional drop in the stocks’ prices look excessive, prompted by the overall decline in Wall Street indices. A comeback for Tesla is seemingly just a matter of time. An initial rebound on Friday, August 18, from the newly found local low of $212.4 to $215.5, already took place. On the next move, Tesla stocks opened the day with another jump above to $228, which confirmed growing demand at these levels. Even if Tesla shares may fall at some point to test the next price support area between $155 to $185, IMHO, this would be another good opportunity to add bullish stakes.
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