Investor's Corner
Tesla's battle lines are drawn with retail investors on one side and Wall St on another
There are very few stocks in the market that inspire such volatility as American electric car maker Tesla (NASDAQ:TSLA). The company has been on a tear lately, propelled by positive Q4 2019 results and emphasized by an ever-growing number of ardent supporters online. Yet amidst these victories, it appears that Tesla has finally reached a point where the battle lines are now being drawn between the company’s supporters, particularly its retail investors and analysts from Wall Street.
Tesla is a tricky company to evaluate, mainly since it covers several industries. The electric car maker is currently the second-largest automaker in the world by market value, though it only produces and delivers a fraction of the vehicles that veteran car companies sell every year. In 2019, Tesla sold just over 367,000 vehicles. Volkswagen, the third-largest automaker according to market cap, sold over 6 million units.
But the Tesla story is never just about the company’s electric cars. A look at Tesla’s mission shows that the company’s goals are bigger than just selling cars and making money doing so. Tesla aims to accelerate the world’s transition to sustainability, and making electric cars that are better than petrol-powered vehicles is but a crucial part of the puzzle. This also means that there are dimensions to the company that lies far beyond that of its electric car business.
It is this last point where the divergence is most evident between Tesla’s supporters and Wall Street analysts. Tesla shareholders, many of whom actually own the company’s products, are intimately familiar with CEO Elon Musk’s overall plans and goals, as well as the scope of the company’s numerous business. Very few of those who own a Model 3, for example, are not aware that Tesla also makes solar roof tiles, or residential batteries like Powerwalls, or grid-scale batteries like Megapacks for that matter.
Unfortunately, a good number of analysts who cover TSLA stock seem to be stuck under the impression that the company is an automaker, full stop. A look at analysts and critics who frequent media outlets such as CNBC shows that very few actually consider the potential, or even recognize the existence of Tesla Energy, a business that legendary billionaire Ron Baron believes could be just as big as the company’s electric car business. Even fewer acknowledge the value of Tesla’s Autopilot data, which are gathered from real-world miles.
This could be seen in Wall Street’s estimates on Waymo, a Google-based company aimed at developing and deploying a self-driving service. Morgan Stanley analyst Brian Nowak wrote in a note to clients last year that the startup is worth $105 billion because of its self-driving technology, and that’s a conservative estimate. Before last year’s update, Nowak valued Waymo at a far more optimistic $175 billion. In comparison, Tesla’s current valuation, as of last Friday’s close, stood at $134 billion. That amount included the company’s auto business, its energy business, and its autonomous driving tech.
As is the nature of Tesla stock, the company’s full potential is usually acknowledged and considered only by the company’s most ardent supporters on the Street. So for now, there is very little chance that the perception of Tesla between its retail supporters and traditional analysts will converge anytime soon. This divergence became a focal point in the company’s recent Q4 2019 earnings call, when Elon Musk admitted that retail investors might have a better grasp of the company’s plans than conventional Wall Street analysts.
“I do think that a lot of retail investors actually have deeper and more accurate insights than many of the big institutional investors and certainly better insight than many of the analysts. It seems like if people really looked at some of the smart retail investor analysts and what some of the smart smaller retail investors predicted about the future of Tesla, you would probably get the highest accuracy and remarkable insight from some of those predictions,” Musk said.
Tesla will likely remain a polarizing company for years to come. That said, Tesla Energy’s ramp is upon the market already, and the company’s Solarglass Roof V3 are now being installed to a growing number of homes in the United States. Tesla’s Full Self-Driving system is also closing in on being feature-complete. Overall, it seems that it will only be a matter of time before the true potential of Tesla emerges, and when it does, one would have to deny a whole lot of the company to consider it just as an automaker.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
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Investor's Corner
Tesla Robotaxi gets a massive upgrade in Nevada
Nevada regulators just approved a massive expansion of Tesla’s robotaxi fleet across the entire county.
Tesla’s robotaxi footprint in Nevada just grew by roughly 500 times in a single regulatory vote.
The Nevada Transportation Authority approved Tesla’s full Autonomous Vehicle Network Company permit on Thursday, clearing the way for the company to deploy up to 5,000 driverless vehicles across Clark County over the next 12 months. The decision came during a four hour general session meeting that Tesla investor Sawyer Merritt watched live and reported on X, noting the vote replaces the interim order that had limited Tesla to just 10 robotaxis on a narrow stretch of the Las Vegas Strip.
EXCLUSIVE: Tesla has just officially received approval for its full Autonomous Vehicle Network Company permit in Nevada, clearing the way for Tesla to launch a paid public Robotaxi service in Las Vegas.
This officially allows @Tesla to deploy up to 5,000 robotaxis over the next… pic.twitter.com/DPs5UtUlrE
— Sawyer Merritt (@SawyerMerritt) August 20, 2026
That earlier cap, covered here after it surfaced on August 13, came with restrictions that looked stricter than what Tesla runs in Austin: a 45 mph speed ceiling, no airport pickups, and a geofence confined to the Strip corridor. The new approval extends Tesla’s operating authority to all of Clark County, with room to request an even wider geofence across the state.
Tesla representatives at the meeting said they have no intention of putting 5,000 cars on the road right away. Commercial rides are expected to start within 30 days, pending vehicle inspections, insurance filings, and fare approval, the standard steps every robotaxi operator in Nevada has had to clear.
Tesla’s own Robotaxi account replied to the news with a short line, The golden future is upon us.
The timing lines up with Tesla’s broader robotaxi push this month. The company is preparing to open Cybercab rides to the public in Austin as soon as this month, and it opened a sweepstakes for riders to win a seat at the launch event. Tesla filed its original application for a 5,000 vehicle Nevada fleet back in June, a request regulators trimmed to 10 vehicles when they issued the interim order in July. Thursday’s vote effectively grants the number Tesla asked for from the start.
Zoox, the Amazon owned robotaxi operator, has run in Nevada since 2025 and was capped at 100 vehicles before Thursday’s decision. Tesla’s new ceiling puts it well ahead of that comparison on paper, though the company has said its actual fleet size will depend on how quickly FSD v15 rolls out, the software update executives have called the gateway to scaling unsupervised robotaxi operations nationwide.
Elon Musk
SpaceX’s next trillion dollar bet has nothing to do with rockets, Musk tells staff
Elon Musk told SpaceX staff AI revenue will soon dwarf rockets and Starlink combined entirely.
Elon Musk told SpaceX employees this week that artificial intelligence, not rockets, will soon carry the company’s revenue. In a roughly 29 minute internal address posted on SpaceX’s X account on Tuesday, Musk said AI revenue will pass every other line of business at SpaceX “probably in September” and pull further ahead by the fourth quarter.
The numbers he gave are specific. SpaceX currently runs 1.4 gigawatts of AI compute capacity. Musk wants that at 10 gigawatts by the end of 2027, a jump he tied directly to revenue: “if we bring 10GW of AI online by the end of next year, it will be $300 billion to $500 billion a year in revenue.” He called those “big numbers,” which undersells a projection larger than what most countries produce in a year.
We made rockets reusable and are rebuilding the internet in space. The next challenge: making life multiplanetary and understanding the true nature of the universe
Watch @ElonMusk deliver a company update to @SpaceX employees pic.twitter.com/5c8rxoCQfu
— SpaceX (@SpaceX) August 11, 2026
Musk went further on where AI fits into SpaceX’s future. “Probably in four or five years, AI will be 99% of the value of SpaceX,” he told staff, adding that digital intelligence would eventually run “a trillion times” ahead of biological intelligence as computing scales. He tied that growth to the company’s founding mission, telling employees “we must win on AI, because the future is overwhelmingly AI and robots,” with the payoff meant to help fund Starship and a Mars program that increasingly runs through Terafab, the joint Tesla, SpaceX and xAI chip plant.
Elon Musk launches TERAFAB: The $25B Tesla-SpaceXAI chip factory that will rewire the AI industry
None of this is entirely new territory. SpaceX told investors much the same story during its first earnings call as a public company on August 4, where Musk moved the company’s $1 trillion revenue target up a year to 2030 and said Starlink could someday carry a majority of the world’s internet. What the all hands video adds is a hard deadline and a specific power figure Musk had not given publicly before, along with a franker pitch to his own workforce that AI, not launch cadence, is now the thing SpaceX is betting its future on.
The AI revenue itself is not coming from SpaceX training its own models. It is largely Starlink acting as the network layer for xAI’s workloads, plus SpaceX renting out compute capacity directly, the same approach behind the roughly $16 billion the company spent on AI infrastructure in a single quarter.
Musk closed the video with a pitch aimed at recruiting and retention rather than investors, telling employees that anyone who helps SpaceX win the AI race will eventually get the chance to go to the moon or Mars themselves. Whether SpaceX can turn 1.4 gigawatts into 10 in seventeen months is the more immediate question, and one that will show up in quarterly numbers well before anyone leaves Earth.
In a new note to investors on Tuesday, Morgan Stanley analyst Andrew Percoco said that Tesla has one big financial question to answer for investors regarding its Robotaxi rollout, Full Self-Driving software, and Optimus.
Percoco said in the note that, for the most part, investors are still very positive about the direction the company is headed. However, there are some things the firm would like to see, and they have to do with financials.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla bulls are more than convinced that the company’s Full Self-Driving software is proof it can develop physical AI. Financially, however, there are still some questions, especially on elevated spending, which CEO Elon Musk said would occur as the company works to roll out Robotaxi faster and continue developing its Optimus robot.
The latter two are where Tesla will have to prove progress to investors, as Percoco writes that both projects “will require clearer evidence that Robotaxi is scaling and more tangible Optimus proof points to support the ROI on elevated capex.”
Percoco said the second quarter earnings call did not change his long-term thesis of where Tesla is positioned in the AI race, which is out in front. However, there are concerns that weaker gross margins and higher R&D spend will stress financials, and that has “sharpened our (and investors’) focus on measurable progress across Robotaxi and Optimus.”
Additionally, Robotaxi still needs to be proven with more operation in existing cities while maintaining safety but improving how many rides it gives in any given time, he said. For Optimus, Percoco wrote that he is “still looking for evidence beyond commentary around SOP.”
Morgan Stanley put Percoco in charge of covering Tesla after long-time analyst Adam Jonas transitioned to the automotive side.
Currently, Morgan Stanley has a $415 price target on Tesla and a ‘Hold’ rating on the stock. It is trading at around $330 at the time of publication, which was 2:30 P.M. on the East Coast.
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