Investor's Corner
Tesla embraced by Wall St. as rave reviews for Model 3 Performance continue to roll in
Nearly a week after Tesla (NASDAQ:TSLA) surprised Wall Street with a relatively better-than-expected earnings report and a more humble Elon Musk, investors held steady, skirting any stock sell-off to retain a 15% gain or roughly $7 billion in market cap. Investor confidence can be attributed to Wall Street’s more optimistic outlook on the company’s immediate future, as well as the consistently positive reviews being received by the Model 3 Performance.
Morgan Stanley analyst Adam Jonas recently maintained an equal-weight rating on the company’s shares and a $291 price target, citing a higher forecast for Tesla’s deliveries in the third quarter. Jonas still believes that Tesla would need to raise around $2.5 billion sometime this year, but he sees the electric car maker delivering 50,400 Model 3 in Q3, more than 30% up from his previous delivery forecast of 33,600 for the third quarter.
“It seems the company has been forced to think more creatively about how to run a leaner operation following its various operational and manufacturing issues. Tesla appears to be applying a greater amount of cash discipline,” Jonas said.
Tesla’s stock has held steady since the company’s successful Q2 earnings call, which saw the Elon Musk and other executives affirm their goals of making Tesla cash flow positive in the third quarter moving forward. Contrary to Jonas’ expectations, Musk was firm in the idea that Tesla will not be raising equity at any time soon, with projects such as Gigafactory 3 in China being funded by local debt.
“We do not – we will not be raising any equity at any point, at least that’s – I have no expectation of doing so, do not plan to do so. For China, I think, our default plan will be to use essentially a loan from the local banks in China and fund the Gigafactory in Shanghai with local debt, essentially. And we certainly could raise money, but I think we don’t need to and we – yeah, I think, it’s better to – it is better discipline not to,” Musk said.
-->Amidst what appears to be a stabilization in TSLA stock are rave reviews from major auto publications about the Model 3 Performance. The Wall Street Journal‘s Dan Neil described the car as a “magnificent” piece of auto engineering that is “representative of the next step in the history of autos.” Kim Reynolds of Motor Trend, while describing a brief sprint in a freeway ramp, stated that “in maybe 120 wheel revolutions, a high-performance hierarchy has been rattled.” Veteran auto journalist Matthew DeBord wrote in a test drive of the vehicle that with the Model 3 Performance, “velocity simply happens… like you’ve Vulcan mind-melded with the laws of physics.”
Even Jalopnik, a publication that is never one to hesitate when pointing out Tesla’s flaws, gave a positive review of the vehicle, with journalist Patrick George calling the car “the most impressive Tesla I’ve driven to date, and easily the most fun.” Mike Ballaban, also from Jalopnik, even raved about the car’s seats, stating that the Model 3 now “takes the crown for Best Seats,” beating out Volvo’s legendary seats in the S60.
The rave reviews showering the Model 3 Performance could be seen as a validation of the massive sprung structure that Tesla built near the end of the second quarter to hit its goal of producing 5,000 units of the electric car in a week. Among the assumptions expressed by Tesla’s critics about the new assembly line was that they would result in vehicles with poor build quality. Tesla VP for trucks Jerome Guillen stated in the Q2 earnings call that all Model 3 Performance are assembled in the sprung structure, but so far, there have been no complaints or even comments about build quality in all the professional reviews that have been written of the vehicle.
The Model 3 Performance is quickly developing into one of Tesla’s most compelling vehicles to date. Apart from the fun factor, it provides due to its nimble nature, the vehicle’s performance figures are also starting to impress. The Model 3 Performance has been recorded showing numbers superior to Tesla’s estimates, with a recent 0-60 mph run with a full battery being listed at 3.18 seconds, far quicker than its listed 3.5-second 0-60 time.
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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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