Mizuho raises Tesla stock price target to $485 on AI and FSD potential

Investing.com - Mizuho has raised its price target on Tesla (NASDAQ:TSLA) to $485 from $450 while maintaining an Outperform rating following the electric vehicle maker’s third-quarter earnings report. The stock, currently trading at $438.97, has delivered an impressive 105.62% return over the past year. According to InvestingPro analysis, Tesla appears overvalued at current levels, though it maintains a "GOOD" overall financial health score.

Tesla reported revenue of $28.1 billion and earnings per share of $0.50 for the third quarter of 2025, meeting revenue expectations while falling slightly short on earnings compared to consensus estimates of $26.4 billion and $0.54, respectively.

The company’s automotive gross margin excluding credits reached 15.4%, up 40 basis points quarter-over-quarter but below the 17.1% consensus, with Mizuho noting a $0.4 billion tariff impact and higher average cost per vehicle affected results.

Mizuho highlighted Tesla’s focus on next-generation AI technology, with its AI5/HW5 platform offering approximately 40 times performance gains, 8 times more computing power, and 9 times more DRAM at 144GB compared to previous generations, supporting the company’s autonomous driving ambitions.

The firm expects Tesla’s upcoming products, including Optimus v3 robots and Cybercab, to begin pilot programs in the first or second quarter of 2026, while the company’s Texas lithium refinery and Nevada LFP battery lines are expected to start production in late 2025 and early 2026, respectively.

In other recent news, Tesla Inc. announced its third-quarter 2025 financial results, reporting a revenue of $28.1 billion, which surpassed forecasts by 7.17%. However, the company’s earnings per share (EPS) fell short of expectations, coming in at $0.50 compared to the anticipated $0.54, marking a 7.41% miss. Piper Sandler reiterated an Overweight rating on Tesla with a price target of $500.00, despite the EPS miss, highlighting the company’s record deliveries and free cash flow for the quarter. Wells Fargo maintained an Underweight rating with a $120.00 price target, citing the EPS miss, high operating expenses, and disappointing automotive gross margins excluding electric vehicle credits. TD Cowen, on the other hand, reiterated its Buy rating with a $509.00 price target, noting that while there are industry challenges, they are not pivotal to Tesla’s long-term investment thesis. These recent developments reflect varied perspectives from analysts on Tesla’s financial performance and future prospects.

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