Loup Ventures co-founder lays out the path for Tesla's market cap to hit $150 billion

Tesla has just raced to a new record.

Shares of the electric automaker climbed more than 3% to a fresh all-time high of $469.73 in Tuesday’s trading session on the back of some news out of China: Tesla began production of the Model Y at its new Shanghai Gigafactory and delivered the first round of its China-built Model 3 vehicles.

Tesla also got a price target raise from analysts at Credit Suisse, who maintained their underperform rating on the stock but upped their target to $340 from $200 commensurate with the recent run. Tesla shares have climbed by more than 97% in the last three months.

Here’s what market watchers, including CNBC’s Jim Cramer — a newfound, self-proclaimed Tesla “believer” — thought of the move:

Gene Munster, managing partner and co-founder of Loup Ventures, compared Tesla’s progress in China with that of Apple:

“China’s the largest [electric vehicle] market in the world, 60-70%. … The average EV sells for about 15,000 U.S. dollars, and so well below [Tesla’s cheapest model, the Model 3]. But I think the right analogy here is what’s happened with Apple. Their China business right now is 17% of total Apple revenue. And right now, China, for Tesla, in the most recent reported quarter, the September quarter, was 11%. And so they’re not going to hit the sweet spot of the China market — they’re just too expensive — but I think that if you start to put the pieces together and say that they can have, call it, 17% of Tesla’s businesses in China, you start to build a model out where you can grow their business at 20% year over year. I’m almost at my punchline here. If you do that, 20% growth for the next few years — they’ll probably grow at 30% this year — and put a 10% operating margin on that a few years out, which is debatable but, I think, achievable, and a 30 multiple on that, you get to $150 billion. So, there’s room. … Tesla’s maintained their, call it, 70% share in the U.S. That’s going to decline over time, no doubt, but we’re talking about 450,000 vehicles this year in a market that’s 90 million globally. And so when I think about that road to a higher market cap, there’s some asterisks there, [CEO] Elon [Musk] needs to continue to behave, but I think that the market and, most importantly, I think that their technology has this 10-year headstart, very similar to what happened at [Amazon Web Services] that a lot of people ignored. But that is fundamental to, whether it’s battery life or some of the visualization around autonomy, advancing this story.”

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