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Tesla’s Elon Musk faces the SEC in hearing over contempt charges (Updates)

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The day after the release of Tesla’s Q1 vehicle delivery and production report, CEO Elon Musk headed to a Manhattan courthouse to face the charges leveled against him by the Security and Exchange Commission (SEC). The SEC accused Musk of violating the terms of his settlement with the agency when the CEO tweeted on February 19 that Tesla will produce around 500k vehicles in 2019, echoing one of his statements from the Q4 2018 earnings call.

Musk arrived in the courthouse on Thursday in light spirits. Smiling to cameras, the Tesla CEO told reporters that he respects the American justice system. “I have great respect for the justice system and I think the judges in the American system are outstanding,” Musk said. When prompted by veteran CNBC reporter Phil LeBeau if he feels the same way about the SEC, Musk laughed and walked forward.

The SEC’s arguments

The courtroom was packed as Elon Musk and the SEC’s legal team faced off before U.S. District Judge Alison Nathan. Each side is given 45 minutes to express their arguments. The agency went first, represented by SEC attorney Cheryl Crumpton, who immediately claimed that Musk “recklessly tweeted out information that has no basis in fact (credit to Matt Robinson of Bloomberg, who is currently conducting a Live Blog of the hearing).”

Explaining further, Crumpton stated that the requirement that Musk get pre-approval for his tweets was “the heart of the relief” that the government had sought as part of its settlement. The SEC lawyer also noted it has become pretty clear “over the course of the last few weeks” that Musk does not intend to comply with last year’s settlement terms. Crumpton added that the agreement does not require every single tweet to be pre-approved, provided that the information in the posts was immaterial. “The communication we are talking about here is very, very different,” she said.

The SEC lawyer also pointed the blame to Tesla, who allegedly is failing to control the conduct of its CEO. “Tesla’s conduct is also troubling to the SEC. This court ordered Tesla to implement a mandatory pre-approval process, but they are apparently fine with Mr. Musk making up his own procedure. Tesla still seems unwilling to exercise any meaningful control over the conduct of its CEO,” Crumpton replied.

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Judge Nathan, for her part, asked the SEC lawyer if Musk would need to get approval for tweets that reiterated information that had already been disclosed. The judge went through different hypotheticals with the SEC lawyer, such as repeating earlier guidance. “We’re not saying always yes or always no to that. It depends is the answer,” Crumpton said.

“This is a material statement no matter how you cut it, and it was a violation to not get it pre-approved,” Crumpton added.

For his alleged violations of his settlement, the SEC lawyer called on the court to give Musk a series of escalating fines if he continues to violate the order. Crumpton also stated that the SEC wants the court to order Musk to report monthly on his compliance with the settlement. “We want the court to tell them that this has to observed in the way that it’s written,” the SEC lawyer said.

Response from Tesla’s legal team

With the SEC having completed its argument, it was time for Elon Musk’s legal team to argue their points. Tesla lawyer John Hueston stated that “it’s very clear that Mr. Musk retained discretion in the policy. The policy makes clear that the tweet is subject to a fact-based determination by Mr. Musk.” The Tesla lawyer also stated that Musk’s decision to decide what’s material information was negotiated. “That’s exactly what Tesla negotiated for and got,” Hueston said.

The Tesla lawyer also argued that the SEC is currently pretending to be shocked that Musk gets to decide what is material information and what is not, but that is exactly what the the order says. “They agreed to take out language saying that everything has to be approved. There has to be an oversight process and there is an oversight process. They’re not happy about that today,” he said.

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Musk’s legal team stated there is  not a clear enough standard to use the harsh recourse of contempt. Instead, Hueston stated that the SEC should have attempted to work things out with Elon Musk and Tesla before bringing the matter to court. “What the SEC should have done was approach in good faith and try to work things out,” the Tesla lawyer said. In response, Judge Nathan noted that her intent is “not only to invite it but to order it.” The judge also added that she will tell the parties to create a new agreement that incorporates the SEC’s concerns.

Addressing Musk’ counsel, Judge Nathan inquired about a scenario in which the CEO will be violating the terms of his settlement with the SEC. When the Tesla lawyer noted that he couldn’t think of one, the judge replied “You’re not very imaginative.”

Continuing his points, Hueston noted that the 15 post-order tweets that were cited by SEC as proof of Musk’s violation of his settlement shows that the agency believes “that, apparently, contempt can fall on him for things that he’s tweeting” even if the information had already been disclosed. “They have not shown that the proof of non-compliance is clear and convincing. This is not someone who’s wantonly saying he doesn’t care about processes and procedures. That’s someone who is trying his best to comply and has been diligent,” the Tesla lawyer said (credit to Bloomberg‘s Chris Dolmetsch for the update).

The SEC’s Rebuttal

The SEC lawyer returned stating that the agency did not rush into its request to have Musk held in contempt at all. “Its not that we rushed into court on the first opportunity. There have been a number of tweets over time.” Crumpton further added that the SEC assumed Musk will comply with the terms of his settlement despite his statements in 60 Minutes, where he explicitly commented that he does not respect the SEC.

Hearing Adjourned

Following the SEC’s rebuttal, Judge Nathan asserted that compliance with court orders is not optional, nor is it a game, regardless of whether you are a “small potato or a big fish.” She also noted that government lawyers must take all steps necessary to reach a resolution before invoking contempt, before adding that she has “serious concerns that whatever I decide here the issue will not be finally resolved.”

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Judge Nathan ordered the two parties to arrange a meeting and send a letter to the court within two weeks. The parties will be required to indicate if they have reached an agreement or not. If no agreement is reached then, Elon Musk’s legal team and the SEC will hear from her in due course.

The hearing was adjourned after. In a statement following the hearing, Musk stated that he was “very impressed with Judge Nathan’s analysis.”

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Investor's Corner

Tesla analysts are expecting the stock to go Plaid Mode soon

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Credit: Tesla Mania

Tesla (NASDAQ: TSLA) has had a few weeks of overwhelmingly bullish events, and it is inciting several analysts to change their price targets as they expect the stock to potentially go Plaid Mode in the near future.

Over the past week, Tesla has not only posted record deliveries for a single quarter, but it has also rolled out its most robust Full Self-Driving (Supervised) update in a year. The new version is more capable than ever before.

Tesla Full Self-Driving v14.1 first impressions: Robotaxi-like features arrive

However, these are not the only things moving the company’s overall consensus on Wall Street toward a more bullish tone. There are, in fact, several things that Tesla has in the works that are inciting stronger expectations from analysts in New York.

TD Cowen

TD Cowen increased its price target for Tesla shares from $374 to $509 and gave the stock a ‘Buy’ rating, based on several factors.

Initially, Tesla’s positive deliveries report for Q3 set a bullish tone, which TD Cowen objectively evaluated and recognized as a strong sign. Additionally, the company’s firm stance on ensuring CEO Elon Musk is paid is a positive, as it keeps him with Tesla for more time.

Elon Musk: Trillionaire Tesla pay package is about influence, not wealth

Musk, who achieved each of the tranches on his last pay package, could obtain the elusive title as the world’s first-ever trillionaire, granted he helps Tesla grow considerably over the next decade.

Stifel

Stifel also increased its price target on Tesla from $440 to $483, citing the improvements Tesla made with its Full Self-Driving suite.

The rollout of FSD v14.1 has been a major step forward for the company. Although it’s in its early stages, Musk has said there will be improved versions coming within the next two weeks.

Stifel raises Tesla price target by 9.8% over FSD, Robotaxi advancements

Analysts at the firm also believe the company has a chance to push an Unsupervised version of FSD by the end of the year, but this seems like it’s out of the question currently.

It broke down the company’s FSD suite as worth $213 per share, while Robotaxi and Optimus had a $140 per share and $29 per share analysis, respectively.

Stifel sees Tesla as a major player not only in the self-driving industry but also in AI as a whole, which is something Musk has truly pushed for this year.

UBS

While many firms believe the company is on its way to doing great things and that stock prices will rise from their current level of roughly $430, other firms see it differently.

UBS said it still holds its ‘Sell’ rating on Tesla shares, but it did increase its price target from $215 to $247.

It said this week in a note to investors that it adjusted higher because of the positive deliveries and its potential value with AI and autonomy. However, it also remains cautious on the stock, especially considering the risks in Q4, as nobody truly knows how deliveries will stack up.

In the last month, Tesla shares are up 24 percent.

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Investor's Corner

Stifel raises Tesla price target by 9.8% over FSD, Robotaxi advancements

Stifel also maintained a “Buy” rating for the electric vehicle maker.

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Credit: Tesla China

Investment firm Stifel has raised its price target for Tesla (NASDAQ:TSLA) shares to $483 from $440 over increased confidence in the company’s self-driving and Robotaxi programs. The new price target suggests an 11.5% upside from Tesla’s closing price on Tuesday.

Stifel also maintained a “Buy” rating despite acknowledging that Tesla’s timeline for fully unsupervised driving may be ambitious.

Building confidence

In a note to clients, Stifel stated that it believes “Tesla is making progress with modest advancements in its Robotaxi network and FSD,” as noted in a report from Investing.com. The firm expects unsupervised FSD to become available for personal use in the U.S. by the end of 2025, with a wider ride-hailing rollout potentially covering half of the U.S. population by year-end.

Stifel also noted that Tesla’s Robotaxi fleet could expand from “tiny to gigantic” within a short time frame, possibly making a material financial impact to the company by late 2026. The firm views Tesla’s vision-based approach to autonomy as central to this long-term growth, suggesting that continued advancements could unlock new revenue streams across both consumer and mobility sectors.

https://twitter.com/AIStockSavvy/status/1975893527344345556

Tesla’s FSD goals still ambitious

While Stifel’s tone remains optimistic, the firm’s analysts acknowledged that Tesla’s aggressive autonomy timeline may face execution challenges. The note described the 2025 unsupervised FSD target as “a stretch,” though still achievable in the medium term.

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“We believe Tesla is making progress with modest advancements in its Robotaxi network and FSD. The company has high expectations for its camera-based approach including; 1) Unsupervised FSD to be available for personal use in the United States by year-end 2025, which appears to be a stretch but seems more likely in the medium term; 2) that it will ‘probably have ride hailing in probably half of the populations of the U.S. by the end of the year’,” the firm noted.

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Investor's Corner

Cantor Fitzgerald reaffirms bullish view on Tesla after record Q3 deliveries

The firm reiterated its Overweight rating and $355 price target.

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(Credit: Tesla)

Cantor Fitzgerald is maintaining its bullish outlook on Tesla (NASDAQ:TSLA) following the company’s record-breaking third quarter of 2025. 

The firm reiterated its Overweight rating and $355 price target, citing strong delivery results driven by a rush of consumer purchases ahead of the end of the federal tax credit on September 30.

On Tesla’s vehicle deliveries in Q3 2025

During the third quarter of 2025, Tesla delivered a total of 497,099 vehicles, significantly beating analyst expectations of 443,079 vehicles. As per Cantor Fitzgerald, this was likely affected by customers rushing at the end of Q3 to purchase an EV due to the end of the federal tax credit, as noted in an Investing.com report. 

“On 10/2, TSLA pre-announced that it delivered 497,099 vehicles in 3Q25 (its highest quarterly delivery in company history), significantly above Company consensus of 443,079, and above 384,122 in 2Q25. This was due primarily to a ‘push forward effect’ from consumers who rushed to purchase or lease EVs ahead of the $7,500 EV tax credit expiring on 9/30,” the firm wrote in its note.

A bright spot in Tesla Energy

Cantor Fitzgerald also highlighted that while Tesla’s full-year production and deliveries would likely fall short of 2024’s 1.8 million total, Tesla’s energy storage business remains a bright spot in the company’s results.

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“Tesla also announced that it had deployed 12.5 GWh of energy storage products in 3Q25, its highest in company history vs. our estimate/Visible Alpha consensus of 11.5/10.9 GWh (and vs. ~6.9 GWh in 3Q24). Tesla’s Energy Storage has now deployed more products YTD than all of last year, which is encouraging. We expect Energy Storage revenue to surpass $12B this year, and to account for ~15% of total revenue,” the firm stated. 

Tesla’s strong Q3 results have helped lift its market capitalization to $1.47 trillion as of writing. The company also teased a new product reveal on X set for October 7, which the firm stated could serve as another near-term catalyst.

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