Investor's Corner
Tesla shares rise amid positive analyst outlook after Gigafactory tour, Chinese rival’s underwhelming IPO
Tesla shares (NASDAQ:TSLA) are rising on Wednesday’s intraday, trading as high as $291.31 per share amid encouraging updates from analysts after a tour of Gigafactory 1, as well as seemingly improved investor sentiments over the company’s updates in management.
Tesla shares took a big blow last Friday amidst reports of former Chief Accounting Officer David H. Morton’s departure from the company after being on the job for just two months. Chief People Officer Gabrielle Toledano also announced that she would not be returning to the company after her ongoing leave. On top of this, CEO Elon Musk courted controversy once more after he seemingly smoked cannabis during a podcast with comedian Joe Rogan.
Amidst the noise from the latest executive departures and Elon Musk’s most recent controversy, Tesla stock saw some recovery on Monday. Baird analyst Ben Kallo, for one, gave the company a “Buy” rating over what he believed were the company’s improving fundamentals this Q3. Kallo also noted that last Friday’s sharp decline in Tesla stock’s price seemed to be a “mispricing.”
Tuesday saw the release of a note from Worm Capital analysts Eric Markowitz and Dan Crowley, who recently went on a tour of Tesla’s Gigafactory 1 in Nevada. The analysts’ note included several compelling updates from Martin Viecha, head of Tesla’s investor relations, who answered questions about the company’s battery tech, its software, and its upcoming vehicles. Viecha, for one, noted that Tesla is on track to achieve a battery cell cost of $100 per kWh by the end of the year, provided that commodity prices remain stable. The Tesla head of investor relations also stated that Tesla would be receiving machines from Grohmann Engineering which would aid the company in producing batteries more quickly and cost-effectively. Updates for the Tesla Semi and the $35,000 base Model 3 were also given.
While the encouraging updates from the Worm Capital analysts were noteworthy, investor sentiments appear to be improving for Tesla as well, particularly after it was announced that longtime problem-solver Jerome Guillen would now be serving as the company’s Head of Automotive, reporting directly to Elon Musk. Guillen is among the most hands-on of Tesla’s longtime executives, known for personally responding to early customers of the Model S during the vehicle’s initial rollout. Guillen appears to be a perfect fit for Tesla’s electric car business, and his promotion could serve as a reassurance for investors regarding Elon Musk being overstretched by his workload and responsibilities in the company.
Wednesday also saw the rather underwhelming IPO of NIO, a highly-anticipated Tesla rival from China. NIO is among the electric car makers that are expected to provide competition to Tesla, to the point where the company’s CEO is fondly dubbed as “The Elon Musk of China.” Among NIO’s first entries into the electric car segment is the ES8, a pure-electric, seven-seater SUV that is seen as a potential rival to the Tesla Model X.
A person familiar with the company’s IPO proceedings informed Reuters that NIO had initially hoped for a valuation of as much as $20 billion. Unfortunately for the company, the ongoing trade tensions between the United States and China, as well as its ongoing cash burn as it attempted to ramp the ES8’s production, weighed down the electric car maker’s IPO. NIO ultimately priced its shares at $6.26, just above the low end of its $6.25-$8.25 target price range. The company sold $1 billion in shares in the IPO, which still made it the third-largest US listing by a Chinese company this 2018.
Similar to Tesla, NIO incurred a significant net loss during the first half of the year, with the company incurring a net loss of $502.6 million on $6.95 million in revenues in the first six months of 2018. NIO noted that as of the end of August, it had delivered about 1,600 units of the ES8, and it still had another 15,778 unfulfilled reservations for the vehicle.
As of writing, Tesla shares are up 3.3% at $288.66 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Tesla bear Michael Burry got blunt with his beliefs over the company’s valuation, which he called “ridiculously overvalued” in a newsletter to subscribers this past weekend.
“Tesla’s market capitalization is ridiculously overvalued today and has been for a good long time,” Burry, who was the inspiration for the movie The Big Short, and was portrayed by Christian Bale.
Burry went on to say, “As an aside, the Elon cult was all-in on electric cars until competition showed up, then all-in on autonomous driving until competition showed up, and now is all-in on robots — until competition shows up.”
Tesla bear Michael Burry ditches bet against $TSLA, says ‘media inflated’ the situation
For a long time, Burry has been skeptical of Tesla, its stock, and its CEO, Elon Musk, even placing a $530 million bet against shares several years ago. Eventually, Burry’s short position extended to other supporters of the company, including ARK Invest.
Tesla has long drawn skepticism from investors and more traditional analysts, who believe its valuation is overblown. However, the company is not traded as a traditional stock, something that other Wall Street firms have recognized.
While many believe the company has some serious pull as an automaker, an identity that helped it reach the valuation it has, Tesla has more than transformed into a robotics, AI, and self-driving play, pulling itself into the realm of some of the most recognizable stocks in tech.
Burry’s Scion Asset Management has put its money where its mouth is against Tesla stock on several occasions, but the firm has not yielded positive results, as shares have increased in value since 2020 by over 115 percent. The firm closed in May.
In 2020, it launched its short position, but by October 2021, it had ditched that position.
Tesla has had a tumultuous year on Wall Street, dipping significantly to around the $220 mark at one point. However, it rebounded significantly in September, climbing back up to the $400 region, as it currently trades at around $430.
It closed at $430.14 on Monday.
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.
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