Tesla shares charged up ahead of battery news

Pardon the pun, but Tesla (TSLA) bulls are charged up.

Just days ahead of the company's announcement about its newest product, a stationary storage battery unit, the company's shares on Monday rose 6 percent to $231.55, sending them nearly 16 percent higher over the past year.

The gains followed an upbeat report from Deutsche Bank analyst Rod Lache, who argued the battery pack has the potential to completely change how consumers and investors look at the electric automaker.

"Based on preliminary work on the economics of stationary storage, we believe that this has potential to be more significant than the Street currently expects," he wrote in a note to investors.

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Lache said the stationary storage business could add $5 to his firm's $20 earnings per share estimate for Tesla in 2020. He went on to say that if Tesla trades with a price to earnings ratio of 20, then the battery business would be worth $100 a share.

To be sure, there are plenty of suppositions behind Lache's estimate. But his optimism is noteworthy, as the battery business will be critical to Tesla's future.

Tesla plans to build the battery packs at its Gigafactory just outside of Reno, Nevada. The massive plant will employ 6,500 workers and has the potential to crank out a half million lithium-ion batteries by 2020.

Since it was announced last year, most have focused on the importance of the Gigafactory for Tesla's electric vehicle business. But now, some are zeroing in on the potential of the stationary storage business.

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"While the Stationary Storage market is still in its infancy, we believe that there are clear indications that significant growth lies ahead," Lache wrote.

Most of that growth is expected to come from Tesla working with solar energy companies such as SolarCity (SCTY). Tesla CEO Elon Musk is the chairman of that firm.

Still, questions remain about Tesla's plans for the stationary storage business, including how much the company will charge to sell or lease the units, as well as how much demand there will be.

Colin Langan, auto analyst at UBS, told CNBC last week that he doesn't forecast his firm ratcheting up earnings per share or revenue estimates given new plans for the batteries. Still, he said it's a positive that the firm is building momentum in the area.

"I think if you look at what Tesla's indicated for the Gigafactory, about a third of the capacity by 2020 if they hit their plan would be dedicated to stationary storage," he said. So even at that point it would still be two thirds auto."

Tesla will unveil the new battery unit on Thursday. It will announce its first-quarter earnings results May 6.

Questions? Comments? BehindTheWheel@cnbc.com .