Tesla shares hit a fresh all-time high on Monday, Chinese banks to lend $1.4 billion to auto maker for Shanghai plant

According to a report by Reuters, citing sources with knowledge of the matter, a new CNY 10 billion ($1.4 billion), five-year loan has been agreed by Tesla Inc (TSLA) and several Chinese banks, which is to be used for the US electric car maker’s facility in Shanghai.

Tesla shares closed higher for a fourth consecutive trading session on NASDAQ on Monday. It has also been the sharpest daily surge since December 18th. The stock went up 3.36% ($13.63) to $419.22, after touching an intraday high at $422.00 and also a fresh all-time high.

Shares of Tesla Inc have risen 25.97% so far in 2019 compared with a 37.38% gain for the benchmark index, Nasdaq 100 (NDX).

In 2018, Tesla’s stock went up 6.89%, thus, it outperformed the Nasdaq 100, which registered a 1.04% loss.

Tesla was already offered a 12-month loan facility of up to CNY 3.5 billion by China banks earlier in 2019, which Tesla is due to repay on March 4th 2020, a company filing with the US Securities and Exchange Commission showed.

According to the sources, the new loan will be partially used to roll over the preceding CNY 3.5 billion facility, while the remainder will be used on the Shanghai plant and Tesla’s operations in China. The interest rate on the new loan will be pegged at 90% of China’s 1-year benchmark interest rate, similar to the preceding loan.

Among the banks that have agreed to fund Tesla’s project are Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China and Shanghai Pudong Development Bank.

Analyst stock price forecast and recommendation

According to CNN Money, the 29 analysts, offering 12-month forecasts regarding Tesla Inc’s stock price, have a median target of $290.00, with a high estimate of $734.00 and a low estimate of $190.00. The median estimate represents a 30.82% downside compared to the closing price of $419.22 on December 23rd.

The same media also reported that at least 11 out of 33 surveyed investment analysts had rated Tesla Inc’s stock as “Buy”, while 10 – as “Hold”. On the other hand, 9 analysts had recommended selling the stock.