Investor's Corner
How Tesla (TSLA) took advantage of the retail investing boom
Tesla (NASDAQ: TSLA) stock has split 5:1. With its increased volume of shares, the price has adjusted accordingly, making its stock more available to retail investors who have become more prevalent and populous during 2020.
TSLA stock officially adjusted in price on Monday, August 31, 2020, and are now available for $442.68 per share. The adjustment in price came after the stock performed a 5:1 split, which was approved by Tesla’s Board of Directors on August 11.
As the COVID-19 pandemic surged through the world and changed life as it was once known, entertainment simply halted. Sports and shows stopped to prevent the spread of the virus, businesses closed and stocks fell. However, while the world was adjusting, it was the opportunity of a lifetime for young, retail investors to get their first taste of Wall Street as company valuations dropped due to closures and decreased demand.
While some businesses wilted in the wake of the pandemic, other entities grew. One of these entities was online brokerage firms, like Robinhood, Charles Schwab, and TD Ameritrade, who all reported increases in accounts through the first quarter of 2020.
Some of these companies experienced a growth of 170% in new accounts, proving that investing on your Smartphone is simple and accessible. Schwab, TD Ameritrade, and E-Trade all reported massive increases in account ownership in Q1 2020 compared to the same time period a year prior. Schwab saw a 59% year-over-year increase in accounts, while TD Ameritrade and E-Trade saw a 149% and 169% increase, respectively.
Why are more accounts being created on these platforms? It comes down to availability, JJ Kinahan of TD Ameritrade said.
“Perhaps because they’re home or perhaps because of furloughs, they also have time to dedicate to their investments that they didn’t necessarily have before,” Kinahan said to CNBC.
However, no-fee trading and accessibility through a Smartphone have also driven a younger demographic to get involved in the market.
“I think a lot of the innovation around trading commissions has really driven the accessibility of the markets for everyone and clearly that cohort, the younger ones, are seeing it for the first time in the headlines every day,” Tim Welsh of Nexus Strategy said to CNBC.
In terms of trading volume from retail investors, it has doubled in 2020 compared to last year as now 20% of daily stock market activity comes from individuals, according to Citadel Securities.
Whether Tesla realized that retail investors were getting involved in trading because of the pandemic is unknown. However, the company did realize that its surge in price per share in 2020 was not favorable for younger individuals or retail investors as a whole, so it performed the split.
CEO Elon Musk considered a split on June 30, when @TeslaGong had mentioned that a stock split would help more fans of the company own shares. While Musk said it was “worth discussing at annual shareholder’s meeting,” the company completed a split more than three weeks before that event will take place on September 22.
Worth discussing at annual shareholders meeting
— Elon Musk (@elonmusk) July 1, 2020
However, allowing fans, employees, and individual investors contributes to Tesla’s mission as a company. Past selling cars or putting solar panels on houses, the goal is to accelerate the world’s transition to sustainable energy. By increasing the number of people who own the company’s stock, Tesla effectively increases the number of supporters it has in making the goal become a reality. With the widespread availability of TSLA shares, more people will contribute to the fight against climate change.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
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.
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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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