Investor's Corner
Tesla bull weighs in on Delaware Court decision against Musk’s TSLA comp plan
Tesla (NASDAQ:TSLA) bull and Wedbush Securities Senior Equity Research Analyst Dan Ives has weighed in on the Delaware Court decision that rescinds Elon Musk’s 2018 compensation plan, which was approved by about 80% of TSLA shareholders at the time. A legal complaint against Musk’s pay package was filed in 2018 by Richard Tornetta, a thrash metal drummer and car enthusiast who held nine shares at the time.
Reactions to the Delaware Court’s decision have been significant among Tesla shareholders. CEO Elon Musk has responded to the decision on X by stating, “Never incorporate your company in the state of Delaware.” He also posted a poll on X asking the social media platform’s users if Tesla should change its state of incorporation to Texas. As of writing, 90% of the poll’s respondents have answered “Yes,” with over 281k votes counted.
Should Tesla change its state of incorporation to Texas, home of its physical headquarters?— Elon Musk (@elonmusk) January 31, 2024
The Wedbush analyst, for his part, admitted that the Delaware Court’s decision had been a jaw-dropper. The analyst noted that the Tesla Board would likely fight back against the court’s decision and perhaps even use this opportunity to come up with a new, updated compensation plan for the CEO. By doing so, Tesla could ensure that Musk stays on board. Ives shared his sentiments in a segment at CNBC’s Last Call.
“The biggest asset in Tesla is Musk. Musk is Tesla, Tesla is Musk. Now, obviously, this is a jaw-dropper that came down in Delaware. I think the Board would ultimately go back to the drawing board and come out with a comp package that could supersede this and maybe get Musk to… 25% voting interest. It’s a pivotal time for Tesla, and the Board is not gonna take this sitting down. This is something they’re gonna fight, and I think it could actually be an ‘aha’ moment for Musk and the Board,” Ives said.
The Delaware decision against @elonmusk and @Tesla is a jaw dropper in our view and we would expect the Board to fight back and take this opportunity to give Musk a new and game changing comp package to secure his future at Tesla with AI front and center @CNBC @LastCallCNBC ?? https://t.co/H2Z5obACiQ— Dan Ives (@DivesTech) January 31, 2024
While the Delaware Court’s decision opened with a passage describing Musk as the world’s wealthiest person, it should be noted that the CEO was far from the world’s richest when his 2018 pay package at Tesla was proposed and approved. At the time, Tesla had a valuation of less than $60 billion, and the compensation plan, which called for Tesla to grow into a company with a market cap of $650 billion, seemed almost laughable.
-->Quite ironically, the Delaware Court’s decision pointed to the idea that its decision was made in the best interests of Tesla shareholders, many of whom have seen their holdings in the electric vehicle maker grow over 10x since Musk’s compensation plan was approved in 2018. Though as of writing, at least, the celebrations in social media are mostly from the company’s short-sellers, who are betting against the company.
The Delaware Court’s decision on Elon Musk’s 2018 compensation plan can be viewed below.
Elon Musk 2018 Comp Plan Delaware Court Decision by Simon Alvarez on Scribd
Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.
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Investor's Corner
Mizuho keeps Tesla (TSLA) “Outperform” rating but lowers price target
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected.
Mizuho analyst Vijay Rakesh lowered Tesla’s (NASDAQ:TSLA) price target to $475 from $485, citing potential 2026 EV subsidy cuts in the U.S. and China that could pressure deliveries. The firm maintained its Outperform rating for the electric vehicle maker, however.
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected. The U.S. accounted for roughly 37% of Tesla’s third-quarter 2025 sales, while China represented about 34%, making both markets highly sensitive to policy shifts. Potential 50% cuts to Chinese subsidies and reduced U.S. incentives affected the firm’s outlook.
With those pressures factored in, the firm now expects Tesla to deliver 1.75 million vehicles in 2026 and 2 million in 2027, slightly below consensus estimates of 1.82 million and 2.15 million, respectively. The analyst was cautiously optimistic, as near-term pressure from subsidies is there, but the company’s long-term tech roadmap remains very compelling.
Despite the revised target, Mizuho remained optimistic on Tesla’s long-term technology roadmap. The firm highlighted three major growth drivers into 2027: the broader adoption of Full Self-Driving V14, the expansion of Tesla’s Robotaxi service, and the commercialization of Optimus, the company’s humanoid robot.
“We are lowering TSLA Ests/PT to $475 with Potential BEV headwinds in 2026E. We believe into 2026E, US (~37% of TSLA 3Q25 sales) EV subsidy cuts and China (34% of TSLA 3Q25 sales) potential 50% EV subsidy cuts could be a headwind to EV deliveries.
-->“We are now estimating TSLA deliveries for 2026/27E at 1.75M/2.00M (slightly below cons. 1.82M/2.15M). We see some LT drivers with FSD v14 adoption for autonomous, robotaxi launches, and humanoid robots into 2027 driving strength,” the analyst noted.
Tesla stock (NASDAQ: TSLA) has landed an elusive “must own” status from Wall Street firm Melius, according to a new note released early this week.
Analyst Rob Wertheimer said Tesla will lead the charge in world-changing tech, given the company’s focus on self-driving, autonomy, and Robotaxi. In a note to investors, Wertheimer said “the world is about to change, dramatically,” because of the advent of self-driving cars.
He looks at the industry and sees many potential players, but the firm says there will only be one true winner:
“Our point is not that Tesla is at risk, it’s that everybody else is.”
The major argument is that autonomy is nearing a tipping point where years of chipping away at the software and data needed to develop a sound, safe, and effective form of autonomous driving technology turn into an avalanche of progress.
Wertheimer believes autonomy is a $7 trillion sector,” and in the coming years, investors will see “hundreds of billions in value shift to Tesla.”
A lot of the major growth has to do with the all-too-common “butts in seats” strategy, as Wertheimer believes that only a fraction of people in the United States have ridden in a self-driving car. In Tesla’s regard, only “tens of thousands” have tried Tesla’s latest Full Self-Driving (Supervised) version, which is v14.
Tesla Full Self-Driving v14.2 – Full Review, the Good and the Bad
When it reaches a widespread rollout and more people are able to experience Tesla Full Self-Driving v14, he believes “it will shock most people.”
Citing things like Tesla’s massive data pool from its vehicles, as well as its shift to end-to-end neural nets in 2021 and 2022, as well as the upcoming AI5 chip, which will be put into a handful of vehicles next year, but will reach a wider rollout in 2027, Melius believes many investors are not aware of the pace of advancement in self-driving.
Tesla’s lead in its self-driving efforts is expanding, Wertheimer says. The company is making strategic choices on everything from hardware to software, manufacturing, and overall vehicle design. He says Tesla has left legacy automakers struggling to keep pace as they still rely on outdated architectures and fragmented supplier systems.
Tesla shares are up over 6 percent at 10:40 a.m. on the East Coast, trading at around $416.
Investor's Corner
Tesla analyst maintains $500 PT, says FSD drives better than humans now
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Tesla (NASDAQ:TSLA) received fresh support from Piper Sandler this week after analysts toured the Fremont Factory and tested the company’s latest Full Self-Driving software. The firm reaffirmed its $500 price target, stating that FSD V14 delivered a notably smooth robotaxi demonstration and may already perform at levels comparable to, if not better than, average human drivers.
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Analysts highlight autonomy progress
During more than 75 minutes of focused discussions, analysts reportedly focused on FSD v14’s updates. Piper Sandler’s team pointed to meaningful strides in perception, object handling, and overall ride smoothness during the robotaxi demo.
The visit also included discussions on updates to Tesla’s in-house chip initiatives, its Optimus program, and the growth of the company’s battery storage business. Analysts noted that Tesla continues refining cost structures and capital expenditure expectations, which are key elements in future margin recovery, as noted in a Yahoo Finance report.
Analyst Alexander Potter noted that “we think FSD is a truly impressive product that is (probably) already better at driving than the average American.” This conclusion was strengthened by what he described as a “flawless robotaxi ride to the hotel.”
-->Street targets diverge on TSLA
While Piper Sandler stands by its $500 target, it is not the highest estimate on the Street. Wedbush, for one, has a $600 per share price target for TSLA stock.
Other institutions have also weighed in on TSLA stock as of late. HSBC reiterated a Reduce rating with a $131 target, citing a gap between earnings fundamentals and the company’s market value. By contrast, TD Cowen maintained a Buy rating and a $509 target, pointing to strong autonomous driving demonstrations in Austin and the pace of software-driven improvements.
Stifel analysts also lifted their price target for Tesla to $508 per share over the company’s ongoing robotaxi and FSD programs.
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