Shares of Tesla Inc. TSLA, -1.40% rallied 2.1% toward a 4-month high in premarket trade Friday, after Jefferies analyst Philippe Houchois turned bullish on the electric car maker, citing optimism over the company’s profit, self-funding and productivity potential. Houchois raised his rating to buy, after upgrading it to hold in April. He raised his stock price target to $450, which is 24% above were it closed Thursday, from $360. Houchois said that after “unrealistic goals” for growth, industrial ramp and automation have been rebased, Tesla is still one of the few original equipment manufacturers that are likely to growth earnings in 2019 and 2020. After visiting Tesla’s Fremont, Calif. facility, Houchois said there is “meaningful scope” to improve productivity and offset the erosion in average sales price with the Model 3. “Tesla should continue to stand out with broader price points, battery security of supply, product edge and a brand that transcends the volume/premium divide,” Houchois wrote in a note to clients. “In short, in the year ahead we think only Tesla will avoid a volume zero-sum-game or negative margin trade-off in EVs.” The stock has soared 38% over the past three months, while the S&P 500 SPX, -2.33% has lost 6.1%.
