Investor's Corner
Tesla skeptic changes tune on Model 3 battery costs: ‘TSLA remains ahead of the pack’
Longtime Tesla skeptic UBS appears to be taking a rather bullish outlook on the electric car maker. In a recent note, UBS analyst Colin Langan raised his price target for Tesla stock (NASDAQ:TSLA) from a conservative $190 to a more optimistic $230, citing the Model 3’s battery cost advantages over competitors currently available in the market.
The UBS analysts, together with a group of engineers, analyzed batteries from Panasonic/Tesla, LG Chem, Samsung SDI, and Contemporary Amperex Technology (CATL). According to the team’s analysis, the Model 3’s batteries, which are produced at the Gigafactory 1 in NV, are around 20% more cost efficient than LG Chem’s batteries, which are the second-best in the list. The UBS analysts estimated that Tesla’s batteries currently cost $111 per kWh, which is around $37 per kWh cheaper than LG Chem’s batteries, its closest competitor.
In what could only be described as an admission of miscalculations in the past, UBS analyst Colin Langan, who has consistently given TSLA a “Sell” rating, noted that the firm now believes that competitors from established automakers would likely be less profitable than the electric car maker in the EV market.
“Contrary to our team’s previous view, they now believe incumbent OEMs will be less profitable than Tesla in EV space. Tesla’s cost advantage can be defended (at least temporarily) because other OEMs will not switch to cheaper NCA chemistry. We continue to believe that TSLA remains ahead of the pack when it comes to EV tech,” the analyst noted.
Based on Tesla’s lower cost battery and considering non-zero emission electric vehicle credits, the UBS analyst also boosted his fiscal 2019 earnings per share estimate for the electric car maker by $5.85 to $3.55, as noted by The Fly. Keeping his longtime stance on the company, though, Langan nevertheless maintained a “Sell” rating on Tesla, with a price target of $230.
While the financial firm remains notably skeptical about Tesla as evidenced by Langan’s consistent “Sell” rating, UBS’ admission of the Model 3’s battery cost advantages could very well signify a shift in Wall Street’s general perception of the electric car maker. Together with a vote of confidence from Zacks Investment Research in the form of a “Strong Buy” rating after Tesla’s release of its third quarter earnings, Tesla’s capability to maintain profitability in the coming quarters is beginning to appear incredibly feasible.
Elon Musk noted during the third quarter earnings call that Tesla would have a positive net income and cash flow in the present quarter, and in all quarters moving forward. Musk even remarked that even in times when Tesla has to conduct repayments, the company should display a flat cash flow.
“We expect to again have positive net income and cash flow in Q4. And I believe our aspiration is something that will be for all quarters going forward. I think we can actually be positive cash flow and profitable for all quarters going forward, leaving aside the quarters where we may need to do a significant repayment but — for example, in Q1 next year. But I think even in Q1, I think we can be approximately flat in cash flow by end of quarter,” Musk said.
Behind these predictions lies Tesla’s battery technology, which continues to get better over time. As noted by President of Automotive Jerome Guillen, Tesla’s batteries are always in a state of improvement. Thus, while UBS’ analysis has concluded that the Model 3’s batteries are the best in the market, Tesla’s batteries in the coming months would likely show an even wider gap over its competitors.
“We are improving the design of the cell. The design of the cell is not frozen. It evolves, and we have a nice roadmap of technology improvements for the coming years,” Guillen said.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Investor's Corner
Tesla’s flying Roadster just revealed something bigger than the car
Analysts say the Roadster demo puts a Tesla and SpaceX merger back on the table.
The Roadster unveiling near Waco ended Thursday night, and by Friday morning much of the investor reaction had less to do with the car than with who owns the rocket technology inside it.
Wedbush analyst Dan Ives said the event “puts the Tesla/SpaceX relationship on the table in a tangible way,” pointing to the propulsion, pressure vessel and control hardware sitting on a Tesla product. Gene Munster of Deepwater Asset Management called the demo “a ridiculous display of engineering” with “no commercial value” beyond embarrassing traditional automakers, though he said it showed Musk wants the two companies together.
The more specific forecast came a day earlier from Barclays. Analyst Dan Levy told clients a deal could be announced before Tesla’s annual meeting, which must happen by December 6, and that an announcement in late October or early November could make shareholder approval harder. Barclays expects SpaceX to be the buyer in an all stock deal, with Tesla holders receiving SpaceX shares at a premium, based on market values of roughly $2.1 trillion for SpaceX and $1.5 trillion for Tesla. If nothing lands around the meeting, the bank still sees an announcement within 6 to 12 months.
The Roadster demo just added more weight to merger speculations. Tesla’s demo used cold gas thrusters and pressure tanks of the kind SpaceX uses on Falcon 9, and Musk described the car as a collaboration between Tesla and SpaceX engineers, as we mentioned in our breakdown of the three Roadster configurations.
Musk has not publicly addressed a deal since the event, as far as we have seen. His most direct answer remains the one he gave at the All In Summit, when he said that with so much collaboration, “who can imagine what action one might take” without ruling anything out. Ives has held to a 2027 timeline since his March note, and Musk pushed back on the China piece of the speculation when ARK floated a year end announcement in August.
The next test is Tesla’s third quarter earnings call on October 21. However, we recall in July that Musk told analysts, “we can’t talk about combining companies and that kind of thing on an earnings call,” so a clear answer wouldn’t be expected.
Elon Musk
Elon Musk breaks his silence on the Starlink impact to Ukraine drones
Musk says the US military and president set Starshield limits, not SpaceX, amid Ukraine complaints.
Elon Musk says the speed limit cutting out Ukraine’s military Starlink terminals is not SpaceX’s decision. In a post on X Wednesday, Musk wrote that “Starshield systems are owned and controlled by the US government. Any limits on speed or usage are decided by the US military and ultimately POTUS.” He added that Starlink is a commercial service limited to civilian or defensive activities and “cannot be used for offensive military action, as doing so would be inappropriate for a commercial company.”
He was replying to Mykhailo Fedorov, Ukraine’s former defense minister, who had thanked Musk for restoring connectivity at speeds up to 160 km/h and said removing the Starshield limit entirely is “now critical for Ukraine’s defense.”
Starshield systems are owned and controlled by the US government. Any limits on speed or usage are decided by the US military and ultimately POTUS.
Starlink is a commercial service owned and controlled by SpaceX. Usage of Starlink is limited to civilian or defensive activities and cannot be used for offensive military action, as doing so would be inappropriate for a commercial company.
— Elon Musk (@elonmusk) October 14, 2026
The complaint started Tuesday night, when Ukrainian officials said military terminals began losing service above roughly 100 mph. Presidential adviser Serhiy Beskrestnov said the defense forces got no warning and several missions were disrupted, as Teslarati reported earlier Wednesday. The 7th Rapid Reaction Corps told Reuters connections dropped for 10 to 20 seconds at speeds well below the limit, which made drones harder to control. Poland’s foreign minister, Radoslaw Sikorski, asked Musk on X whether he is “playing politics with your products again.”
That is why the Starlink and Starshield distinction matters. SpaceX introduced Starshield in 2022 as the government version of Starlink, with an initial focus on Earth observation, communications and hosted payloads. It won a Space Force contract in 2023 with a $70 million ceiling. In December 2024, the Pentagon moved Ukraine’s terminals onto Starshield, covering about 3,000 units across two contracts. Ukraine’s military connections therefore run through a service that Musk now says sits under Washington’s control.
While Musk’s post describes who holds authority, it does not infer that anyone ordered the limit, and neither SpaceX nor the US government has confirmed who set it. Ukrainian officials have pointed to the timing, which follows President Trump’s push for an energy ceasefire and Musk’s Saturday post that “Zelensky has gone too far.” The BBC noted Trump denied threatening to restrict intelligence sharing with Kyiv, and no evidence has been presented that Washington requested the cap.
The episode also revives a promise from 2025. After Poland accused him of threatening Ukraine’s access, Musk said Starlink “will never turn off its terminals” and would not be used as a bargaining chip. Poland has since supplied more than 29,000 terminals to Ukraine. Teslarati also covered Kyiv’s search for Starlink alternatives in 2025, and the latest dispute gives that search new urgency.
Investor's Corner
Tesla opens the Q&A for its biggest earnings call yet
Tesla opens its Q3 earnings Q&A, and Cybercab, Robotaxi, Optimus and regulators loom over October 21.
Tesla has opened its shareholder question portal for the Q3 2026 earnings call, with the Say Q&A page already listing questions. Investors have until 4:00 p.m. EDT on October 20 to submit and vote on what management should answer.
The call is set for Wednesday, October 21. Tesla will post results after the market closes, with a live webcast at 4:30 p.m. CT, or 5:30 p.m. ET, through its investor relations site.
Say ranks questions by the number of shares behind the votes, which gives institutional holders extra weight over the retail crowd.
Ahead of Q2, retail investors asked why Robotaxi growth had stalled, when Cybercab would start customer rides, and where the Optimus Gen 3 ramp stood, while an institutional holder asked how Tesla and SpaceX would split Terafab duties. Cybercab has since answered one of those. Tesla said last week it has 300 plus Cybercabs serving Austin, up eightfold in 30 days, with Dallas named as the next city. The questions now are likely to move from when to how fast.
There is also a regulatory question hanging over the call. NHTSA has demanded sworn answers on how the pedal free Cybercab was certified against federal safety standards, with responses due October 30, nine days after the call. Whether an analyst raises it live is unknown, but it is the kind of exposure that tends to find its way into a Q&A.
The numbers will not be the main draw. Tesla already reported 486,532 deliveries and 13.7 GWh of storage for the quarter. Consensus sits around 43 to 45 cents per share on roughly $27.8 billion in revenue, according to Zacks, after a Q2 report that missed on EPS. Goldman Sachs, which holds a Neutral rating and a $360 target, argues the outlook for Robotaxi, FSD and Optimus will matter more to the stock than the quarter itself.
The call also lands six days after the rescheduled Roadster event, which Tesla will stream on X on Thursday, October 15, at 7:55 p.m. CT. If the Roadster shows up with a production date or a SpaceX thruster package, expect it to climb the voting list before the deadline.
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