Investor's Corner
Tesla could see a ~40% rally, but that doesn’t mean it’s a ‘Buy,’ claims analyst
In a rather interesting episode of CNBC‘s Trading Nation, Oppenheimer technical analyst Ari Wald mentioned that Tesla stock (NASDAQ:TSLA) could be poised to see some recovery. Despite this, the analyst mentioned during his segment that he does not consider Tesla stock a “Buy.”
The Oppenheimer analyst argued that Tesla stock has been notably volatile to the point where its price direction is nearly aimless. In the past 12 months alone, Tesla shares swung from prices as high as $387 per share to as low as $244.59 per share. With $250 being a big support range level, Wald estimated that TSLA shares could swing back to $360 per share.
“This is one we’ve been on the sidelines with, avoiding both on the long end and short side, just given how directionless and choppy it’s been, and that’s still the case. It’s paid to buy it when it’s ugly and sell it when it starts to look good, so with that in mind, it probably looks more positive than not, just considering how bad it’s performed; $250 is the big support range level, $360 is the upside there,” the analyst said.
If Tesla does move back to the $360 per share level, it will represent a nearly 40% upside from Monday’s $260.42 close. Yet, despite the potential recovery, Wald stated that this does not mean TSLA is a “Buy.” “You can see the flat 200-day that exemplifies that directionless action. If we allocate toward stocks that trend, this isn’t one of them,” he noted.
Tesla stock has been weighed down recently partly due to concerns over the Model 3’s alleged “meager” demand and the ongoing issues between CEO Elon Musk and the Securities and Exchange Commission (SEC). On Monday alone, RBC analyst Joseph Spak slashed his price target on Tesla by $35 to $210 each. JMP Securities analyst Joseph Osha also trimmed his price target for Tesla by 3% to $394 per share. Both analysts cited reservations over the Model 3’s demand this first quarter as among the drivers behind their more conservative estimates.
Tesla, for its part, appears to be drawing the curtains back for some good news. On Monday, Tesla proved victorious after a judge dismissed a lawsuit claiming that the company committed fraud during the initial months of the Model 3 production ramp. A recent update from Morgan Stanley analyst Adam Jonas also confirmed that Tesla is not under a Wells notice and is not legally prevented from issuing stock, putting to rest a persistent point that has been brought against the company by its critics. The average price target in Wall St for Tesla stock also remains at $335 per share, implying a ~30% upside from Monday’s close.
This Tuesday, Tesla’s shares appear to be getting a breather, trading (+2.90%) at $267.84 per share as of writing.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
Investor's Corner
Tesla analyst realizes one big thing about the stock: deliveries are losing importance
Tesla analyst Dan Levy of Barclays realized one big thing about the stock moving into 2026: vehicle deliveries are losing importance.
As a new era of Tesla seems to be on the horizon, the concern about vehicle deliveries and annual growth seems to be fading, at least according to many investors.
Even CEO Elon Musk has implied at times that the automotive side, as a whole, will only make up a small percentage of Tesla’s total valuation, as Optimus and AI begin to shine with importance.
He said in April:
“The future of the company is fundamentally based on large-scale autonomous cars and large-scale and large volume, vast numbers of autonomous humanoid robots.”
Almost all of Tesla’s value long-term will be from AI & robots, both vehicle & humanoid
— Elon Musk (@elonmusk) September 11, 2023
Levy wrote in a note to investors that Tesla’s Q4 delivery figures “likely won’t matter for the stock.” Barclays said in the note that it expects deliveries to be “soft” for the quarter.
In years past, Tesla analysts, investors, and fans were focused on automotive growth.
Cars were truly the biggest thing the stock had to offer: Tesla was a growing automotive company with a lot of prowess in AI and software, but deliveries held the most impact, along with vehicle pricing. These types of things had huge impacts on the stock years ago.
In fact, several large swings occurred because of Tesla either beating or missing delivery estimates:
- January 3, 2022: +13.53%, record deliveries at the time
- January 3, 2023: -12.24%, missed deliveries
- July 2, 2024: +10.20%, beat delivery expectations
- October 3, 2022: -8.61%, sharp miss due to Shanghai factory shutdown
- July 2, 2020: +7.95%, topped low COVID-era expectations with sizeable beat on deliveries
It has become more apparent over the past few quarters that delivery estimates have significantly less focus from investors, who are instead looking for progress in AI, Optimus, Cybercab, and other projects.
These things are the future of the company, and although Tesla will always sell cars, the stock is more impacted by the software the vehicle is running, and not necessarily the vehicle itself.
Tesla needs to come through on this one Robotaxi metric, analyst says
Tesla gets bold Robotaxi prediction from Wall Street firm
