What happened
Shares of Tesla (TSLA 12.06%) surged on Wednesday, climbing as much as 6.2%. As of 11:05 a.m. EST, the stock was up 5.1%. This extends a gain for the stock that occurred yesterday.
The growth stock may be rising on Wednesday simply due to a rebound from last week's sharp sell-off. The stock's gain may also reflect growing buzz on Wall Street for electric vehicles.
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So what
Since electric vehicle maker Rivian Automotive (RIVN -2.21%) went public last week, the electric vehicle market has received a lot of attention. Shares of Rivian and Lucid Group (LCID 1.19%) have soared, climbing 46% and 35%, respectively, over the past five trading days.
With rising interest in electric vehicles on the Street, it's not surprising to see Tesla stock rebounding from a more than 15% decline last week. Shares were pressured last week as Tesla CEO Elon Musk revealed a plan to unload 10% of his stake in the company to pay taxes.
Analysts have grown increasingly bullish on Tesla stock since the company's strong third-quarter earnings report. Earlier this month, Wedbush analyst Daniel Ives set a mind-boggling 12-month price target of $1,800 -- up from his previous estimate of $1,500. He notes that the company's improving margin profile and the potential for electric vehicles to gain more mainstream adoption has led to a major rerating for Tesla stock's valuation in September and early November.
Now what
High expectations, of course, mean that Tesla will have to deliver near-flawless business execution in the fourth quarter and in 2022.
For Tesla's fourth quarter, analysts are modeling for more strong growth for the company. On average, they expect revenue of $15 billion, up from $10.7 billion in the year-ago quarter. More impressively, the consensus analyst forecast calls for non-GAAP (adjusted) earnings per share to increase from $0.80 in the year-ago period to $1.92.
