Investor's Corner
Tesla (TSLA) gets nine-day streak, bullish outlook heading into Q3 earnings call
Tesla stock (NASDAQ:TSLA) is approaching its impending third-quarter earnings call with a nine-day consecutive streak and a positive outlook from one of its most ardent supporters on Wall Street.
Since revealing that it has delivered 97,000 vehicles in the third quarter at the beginning of October, Tesla stock has seen itself dip and subsequently recover. After the Q3 delivery report’s release, shares dropped by about 4.2% over Tesla’s alleged inability to deliver on Elon Musk’s optimistic estimate, which indicated that the company had a shot at delivering 100,000 vehicles in Q3.
TSLA stock was thus punished for not meeting a goal that it never formally set. This was especially true considering that the average estimate among 21 financial firms covering Tesla expected the company to deliver about 94,000 vehicles in the third quarter. Eventually, Tesla stock recovered and as of this Wednesday, shares closed at $259.75, gaining nearly 11.5% over its streak. By the end of Thursday, Tesla’s momentum had extended to nine consecutive days.
Amidst this recovery, Tesla shares have received a vote of confidence from one of its most ardent supporters on Wall Street. In a recently published note, Baird analyst Ben Kallo reiterated his “Outperform” rating and $355 price target on Tesla shares, stating that he would be a buyer ahead of earnings on the expectation of sequential gross margin improvement.
“We think results could surprise to the upside (there is an outside shot the company achieves GAAP profitability, in our view), though there are several variables, including leasing and Service/Energy margins, which could hinder near-term profitability. 2019 volume guidance will likely also be a focus as the market looks to bridge Q4; we think tightening guidance lower would remove an overhang on the stock,” Kallo noted.
-->In a way, Kallo’s expectation of Tesla’s GAAP profitability might be quite optimistic, especially in light of Wall Street looking at a year-over-year dip in quarterly revenue for the first time in over a decade. This, as noted in a report from MarketWatch, is likely due to third quarter vehicle deliveries being skewed heavily towards the Model 3, the company’s most affordable vehicle. In contrast, Q3 2018 ended with 84,000 vehicle deliveries, of which 56,000 were Model 3.
It is not only Kallo that holds an optimistic stance on Tesla stock. Fellow analyst Colin Rusch from Oppenheimer recently noted that he continues to believe Tesla’s Q3 delivery number was strong relative to expectations. Rusch positions the company to beat gross margin estimates should it deliver on some of the manufacturing efficiencies it has been working on. The Oppenheimer analyst further explained that Tesla’s Q3 gross margins may benefit from the higher mix of Model 3 sales in the European region, particularly as emission credit monetization could boost earnings in the quarter.
Rusch currently holds an “Outperform” rating and a $356 price target on Tesla stock.
As of writing, Tesla stock is trading -0.38% at $260.97 per share.
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
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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