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Tesla poised to shrug off tweet chaos as sentiment turns

[CHICAGO] The tide might finally be turning for Tesla investors, who have been on a choppy ride this year.

Shares of the electric vehicle maker were poised to wipe out the steep losses since early August, post touching a high of US$387.46. The stock was up 3 per cent at 10.24am in New York, after jumping as much as 4.5 per cent to touch a high of US$379.49.

The latest vote of confidence came from Jefferies analyst Philippe Houchois, who upgraded his rating on Tesla to buy from hold, saying the company looks positioned to outperform electric-vehicle peers in the coming year.

Broader price points, battery improvements and a strong brand will help Tesla grow earnings in 2019-2020, Mr Houchois wrote in a note to clients. Tesla is also shoring up its balance sheet even though governance issues remain a concern for many investors after founder Elon Musk's botched plan to take the company private.

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"We think it is fair to ask whether Musk intends to remain as CEO," Mr Houchois wrote. "In a downside scenario, we think potential M&A provides a floor to valuation."

Jefferies raised its price target on Tesla shares to US$450 from $US360, among the highest of analysts surveyed by Bloomberg.

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