Tesla stock is rising again, extending its monster 40% rally over the past month

Tesla (TSLA) stock rose as much as 1.1% in early trading Friday, putting the stock on track to extend its longest winning streak in more than a year and continue its market leadership.

After rising 30% over the past seven sessions — and rising nearly 40% over the past month — the stock is close to breakeven for 2024 after falling as much as 40% year-to-date as of mid-April.

Over the past month, the S&P 500 has posted a more modest gain of 3.5%.

Tesla’s extended rally comes as the automaker beat its quarterly deliveries earlier this week.

In addition to these production and delivery results, Tesla optimists also highlighted the company’s fastest-growing segment: its energy storage business.

“Tesla started its Independence Day celebration early with a positive second-quarter delivery rate, 33,000 lower inventory, and strong stockpiling to remind investors that it is not just a car company,” Morgan Stanley’s Adam Jonas wrote in a recent note.

Another positive catalyst came following the release of the Chinese provincial government’s purchase list on Thursday, which included locally built Tesla cars.

The catalog for eastern China’s Jiangsu province includes Tesla’s Model Y vehicle, meaning government employees are allowed to purchase the vehicle as a company car, according to Reuters.

HANGZHOU, CHINA - AUGUST 14, 2023 - Customers buy electric cars at a Tesla store in Hangzhou, east China's Zhejiang Province, Aug. 14, 2023. On the same day, Tesla announced that it had lowered the price of its two high-end Model Y models in the Chinese market, cutting the price of each car by $1,900 (about 14,000 yuan), and also announced a limited-time insurance subsidy of 8,000 yuan for existing Model 3 car orders. (Photo credit should read CFOTO/Future Publishing via Getty Images)

Customers buy electric cars at a Tesla store in Hangzhou, east China’s Zhejiang province, Aug. 14, 2023. (CFOTO/Future Publishing via Getty Images) (Future editions via Getty Images)

Tesla has faced fierce competition from Chinese peers abroad and a decline in demand for electric vehicles in the United States. In an effort to cut costs, the company launched a plan to cut more than 10% of its global workforce earlier this year, which some analysts saw as a harbinger of tough times ahead.

The company also cut prices last year to boost sales.

At Tesla’s shareholder meeting last month, CEO Elon Musk confirmed that near-term demand and sales will still be somewhat challenging as the industry goes through a transition period.

“There is always the risk of further price declines ahead, and it [are] “There are still some fundamental questions, we’re still in a bit of an EV demand winter,” Dan Levy, senior equity research analyst at Barclays, told Yahoo Finance earlier this week. “So, good result. But I think the fundamental macro backdrop is still the same.” Levy gave the stock an equal weight rating and a $180 price target.

Tesla will report its quarterly results on July 23 after the market closes. Analysts are also looking forward to August 8, when the company will unveil its highly anticipated robotaxi.

“The key to Tesla’s stock is for the stock market to recognize that Tesla is the most undervalued AI stock on the market,” Wedbush CEO Dan Ives wrote in a note this week, as he raised his price target on the stock to $300 from $275 with a new upside scenario of $400 by 2025.

Ives added that the company’s robotaxi event on August 8 “will lay the yellow brick road to [full self-driving] and an autonomous future.”

The stock has pared all of its year-to-date losses, jumping more than 70% from its late April lows.

Ines Ferre is a senior economics journalist for Yahoo Finance. Follow her on X at @ines_ferre.

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