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Is Buying Tesla Stock A Good Investment Decision?

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Tesla, the electric car giant, has shown some immense growth in recent years. The delivery numbers have constantly been on a rise, and each quarter is showing to be more promising than the last one.

There are many brands when it comes to manufacturing electric vehicles, but Tesla seems to dominate the industry. After the full third-quarter results revealed by Tesla, analysts expect adjusted earnings of around $1.54 per share with a revenue of around $13.7 million.

Chip shortage affected Tesla in the second quarter, but despite that, the revenue of the company doubled to around $11.96 billion. Naturally, investors are now interested in the tesla stock forecast 2025.

But before rushing there it is crucial to first understand whether investing in the company is a good decision for you.

Let us find out more below.

Expansion of Tesla

Tesla has undertaken a massive expansion throughout the globe. The company has increased its manufacturing capabilities, and it aims to build 20 million electric vehicles over the next decade. That is more than double the current production of its competitors and other EV production giants. Thus, the primary focus of Tesla at the moment is to increase its manufacturing abilities.

The autopilot probes of Tesla have also expanded. Several accidents were reported by Tesla when the vehicle was in autopilot mode. A person was killed while changing tires of a Tesla vehicle that crashed in New York, and safety regulators will probe the company regarding that.

Tesla is thinking about expanding its base in Germany. There, it will go on a head-to-head battle with other established names like BMW, Volkswagen Group, and the Mercedes Benz division. There are other competitors too in the German market and Tesla will have to put up its sleeves to establish its name in that country, like the other ones.

Evaluation of Tesla stock

According to the IBD stock checkup tool, the IBD composite rating of Tesla stock is 98 out of 99. The general rule for big potential gains is to choose growth stocks based on the CAN SLIM investment paradigm. It is advised that you should always focus on stocks that have a composite rating of 90 or higher. What is even better is if you aim for 95 or more at the start of a new bull market.

The stock also comes with a relative strength rating of 88 out of 99, which means that Tesla has outperformed other stocks by 88% in the IBD database over the last year.

The accumulation/distribution rating analyzes the price and volume changes of a given stock for 13 weeks of trading. Tesla has an A- rating in that, which indicates heavy institutional buying. The lowest rating here is E, which indicates heavy selling. A stock with grade C is depicted as neutral.

Looking at the relative strength line of Tesla, it is constantly trending upward and holding. It is definitely a positive signal, as it measures the strength of the given stock against all the other stocks.

We all know the importance of timing when it comes to the stock market. Thus, if you are thinking about buying or selling stocks, you should do the fundamental and technical research thoroughly. It would help you identify the entry points that bear low risks, and have a higher potential reward.

Should you buy Tesla?

The Tesla stock is extended from a cup-with-a-handle-base and the buy point is 764.55. It is on an upward trek, and if that continues, soon its buy point will go as high as 900.50. According to the leaderboard, the company continues to find support above its key 50-days and 200-days moving averages, which is a good sign.

If you are into investing in large-cap stocks, it is essential to perform a thorough technical analysis of the given company to see if it is near your right buy zone. You should also lookout for the warning signs and sell signals, to acquire the maximum profits or minimize your loss. You should also ardently follow the current trends in the stock market to make the right purchase. Also, when you decide to invest, ensure to check the market conditions properly.