Tesla Model S Plaid sedan
Tesla Model S Plaid.
  • Wedbush's Dan Ives reiterated his $1,000 12-month price target for Tesla on Friday.
  • The analyst expects a number of concerns including the chip shortage and PR issues in China to subside.
  • He sees Telsa's stock benefitting from the oncoming "green tidal wave" of demand for EV's over the next five years.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

One of Wall Street's biggest Tesla bulls is doubling down on his optimism for the stock despite 2021's underwhelming performance.

In a Friday note to clients, Wedbush's Dan Ives reiterated his 12-month price target of $1,000 for the electric vehicle maker's stock, representing 32% jump from current levels.

After a record 740% rally in 2020, Tesla has eked out a mere 3% gain so far this year. Ives blamed a number of issues for the underperformance, including the lingering semi-conductor chip shortage, safety concerns in China, regulatory concerns, and rising electric vehicle competition.

"That said, seeing the forest through the trees we believe Tesla has a number of growth levers into 2022 that should accelerate growth and profitability with global EV demand further inflecting over the next 12 to 18 months," said Ives. "We continue to believe there are many winners in the EV arms race to play this transformational growth opportunity including traditional stalwarts and pure play EV OEMs/supply chain plays with Tesla front and center."

Ives has long said that demand in China is a key driver for Tesla's growth. But 2021 has been a tough year for the EV maker's reputation in China, mired with a fatal crash, safety recalls, and CEO Elon Musk being forced to reject reports the country's military had banned its cars.

According to Ives, those headwinds in China are beginning to reverse course, and Tesla is on track to hit 900,000 annual deliveries in 2021. While electric vehicles only represent 3% of the overall automobile industry globally, he sees that share growing to 10% by 2025 as countries move towards reducing carbon emissions. This will result in a boom of demand for electric vehicles, and Tesla's stock is poised to benefit, he said.

The analyst also explained that the semiconductor chip shortage is a "near-term" issue that the company will be able to get past.

Shares of Tesla slipped 0.15% on Friday after the opening bell.

Read the original article on Business Insider