Investor's Corner
Tesla remains under pressure as Bernstein questions TSLA assets
Tesla stock (NASDAQ:TSLA) neared the $180 per share support level on Monday, amidst the release of a bearish note from Bernstein analyst Max Warburton, who questioned the value of Tesla’s “assets.” In his note, the analyst claimed that the value (or lack thereof) of the electric car maker’s tech, factories, charging network, and brand would likely make the company unattractive to potential buyers, such as Volkswagen AG.
“What assets are attractive? Tesla no longer has genuinely differentiated tech. The production plant is sub-par. The Gigafactory is probably not essential (and may be claimed by Panasonic). The brand still has value, albeit one that is declining fast. The Supercharger Network also has some value. Perhaps these get picked up. But at what price? We struggle to see it being sold as a going concern,” Warburton stated.
It should be noted that Warburton is not Bernstein’s leading TSLA analyst. Instead, he covers several European automakers for the financial firm, some of whom would likely take a look at the electric car maker if it hits a point where an acquisition becomes a plausible scenario. Despite his reservations on the Silicon Valley-based company, the analyst did credit Tesla for its technology, which have put German automakers in a defensive position.
“Its technology seemed ahead of all other OEMs – damaging the Germans’ relative brand position. Tesla took market share from the German OEMs in the US, UK, and some other regions. But (the) financial failure of Tesla would force a change in investors’ views of traditional OEMs. It would show how difficult it is for a new entrant to succeed. Most important: it would change views on the size and growth rates of the EV market,” the Bernstein analyst noted.
Warburton’s observations and reservations about Tesla’s assets seem premature at best and ill-conceived at worst. If Tesla’s tech really does not hold an edge against veteran automakers anymore, for example, then vehicles such as the Audi e-tron have no excuse for their subpar efficiency and range compared to the older, larger Model X. Over-the-air firmware updates should also be the norm across experienced automakers if the analyst’s statements about Tesla’s non-differentiated tech are accurate. It should also be noted that Warburton seems to be grossly undervaluing the Fremont factory, Gigafactory, and the Supercharger Network, all of which are pretty much unmatched in the EV market today.
Besides, considering leaked emails from Tesla CEO Elon Musk about the company’s potential numbers for the second quarter, it is likely far too early to start speculating about why the electric car maker cannot be sold. After all, Tesla is not for sale, at least at this point.
Interestingly, these sweeping doubts about Tesla’s value were mentioned by New Street Research analyst Pierre Ferragu, who currently holds an optimistic $530 price target on TSLA stock. Ferragu recently stated that Tesla’s current rough phases would likely come to pass, especially since the company captured about 15% of the premium car market in the US in March and April. The New Street Research analyst also noted that there is a “disconnect” when it comes to TSLA shares today. “The disconnect between sentiment and reality on Tesla is at its all-time high,” Ferragu said.
As of writing, Tesla stock is trading -1.73% at $181.95 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Tesla stock (NASDAQ: TSLA) closed at an all-time high on Tuesday, jumping over 3 percent during the day and finishing at $489.88.
The price beats the previous record close, which was $479.86.
Shares have had a crazy year, dipping more than 40 percent from the start of the year. The stock then started to recover once again around late April, when its price started to climb back up from the low $200 level.
This week, Tesla started to climb toward its highest levels ever, as it was revealed on Sunday that the company was testing driverless Robotaxis in Austin. The spike in value pushed the company’s valuation to $1.63 trillion.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
It is the seventh-most valuable company on the market currently, trailing Nvidia, Apple, Alphabet (Google), Microsoft, Amazon, and Meta.
Shares closed up $14.57 today, up over 3 percent.
The stock has gone through a lot this year, as previously mentioned. Shares tumbled in Q1 due to CEO Elon Musk’s involvement with the Department of Government Efficiency (DOGE), which pulled his attention away from his companies and left a major overhang on their valuations.
However, things started to rebound halfway through the year, and as the government started to phase out the $7,500 tax credit, demand spiked as consumers tried to take advantage of it.
Q3 deliveries were the highest in company history, and Tesla responded to the loss of the tax credit with the launch of the Model 3 and Model Y Standard.
Additionally, analysts have announced high expectations this week for the company on Wall Street as Robotaxi continues to be the focus. With autonomy within Tesla’s sights, things are moving in the direction of Robotaxi being a major catalyst for growth on the Street in the coming year.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
Tesla Semi program Director teases major improvements
Tesla dominates in the UK with Model Y and Model 3 leading the way
