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Tesla Inc. is poised to join the trillion-dollar club next year, defying growing Wall Street skepticism regarding electric vehicle demand, according to Wedbush analyst Dan Ives.

The longtime bull on Tesla TSLA said the bear case on the company was that demand was eroding at a time when competition around the world was increasing.

“Instead, Musk made a poker move for the ages and cut prices globally with China front and center to catalyze volumes/units which should now impressively be in the 1.8 million range for 2023,” the prolific analyst wrote in a note to clients.

Ives reiterated the outperform rating he’s had on the stock for years, raising his 12-month price target to $350 from $310. The new target implies a market capitalization of $1.11 trillion at current share counts.

The stock rallied 0.7% in premarket trading. At Thursday’s closing price of $254.50, Tesla’s market cap of $809.14 billion made it the U.S. seventh-most valuable company.

Ives said Tesla has navigated the “Category 5 storm in China well,” as he believes fourth-quarter volumes there will hit another record as demand steadies.

He also believes that gross margins, which have been a concern on Wall Street given recent price cuts, have now stabilized, and should start moving up into 2024.

“While overall EV demand has clearly moderated globally we are still in the early days of this massive transformation with Tesla leading the way as we estimate by 2030 roughly 20% of autos will be EV based,” Ives wrote. “Also noteworthy is that as Detroit stalwarts GM and Ford among others appear to be tempering the EV transformation, Tesla is now doubling down with Cybertruck and we expect another sub $30k vehicle to be announced over the next 6 to 9 months.”

Read: The Tesla Cybertruck is finally here; prices start around $61,000.

Tesla’s stock has rocketed 106.6% year to date through Thursday, while rival General Motors Co. shares
have gained 7.8% and Ford Motor Co.’s stock
has tacked on 6.1%. The S&P 500 index
has advanced 23.6% this year.

Ives’ bullish call comes as China’s state media reported that Tesla’s plans to produce energy-storage batteries in China have moved forward with a signing ceremony for the land acquisition. Construction is scheduled to start next year, Xinhua News Agency said.

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