Stifel reiterates Buy rating on Tesla stock, maintains $440 price target

Investing.com - Stifel has reiterated its Buy rating on Tesla (NASDAQ:TSLA) stock with a price target of $440.00, following Tesla’s proposal of a new compensation package for CEO Elon Musk. The stock, currently trading at $349.91, has delivered an impressive 47% return over the past year, though InvestingPro analysis suggests the stock is trading above its Fair Value.

The electric vehicle maker, now commanding a market capitalization of $1.13 trillion, unveiled a compensation strategy that could potentially be worth $1 trillion for Musk, contingent upon meeting what Stifel describes as "very aggressive" milestones that would require "sustained executional excellence."

Tesla proposed a new award of 96 million shares to Musk under its 2019 equity incentive plan on August 4. The company also revealed a longer-term CEO compensation strategy amounting to 423,743,904 shares of Tesla’s common stock, representing 12% of the adjusted share count.

According to Stifel, achieving the full compensation would require robust growth in auto deliveries, success in full self-driving technology, traction in the Robotaxi business, and "outstanding success" of the Optimus robot.

Stifel maintains that Musk is "a critical driver of Tesla’s long-term success" and notes that the "unprecedented long-term compensation plan clearly incentivizes him to lead Tesla for the long term."

In other recent news, Tesla’s earnings and revenue developments have captured attention. Tesla’s new incentive plan for CEO Elon Musk aims for an ambitious $8.5 trillion market cap, signaling his long-term commitment to the company. Analysts at William Blair have reiterated their Market Perform rating for Tesla, while Wedbush maintained an Outperform rating with a $500 price target, citing Musk’s commitment to remain with the company through 2030. Tesla’s UK sales rose by 7.63% in August, reflecting a broader 15% increase in the electric vehicle market there. In China, Tesla’s shipments in August dropped to 83,192 units, although sales increased by 22.5% compared to July. Piper Sandler reiterated an Overweight rating with a $400 price target, highlighting Tesla’s progress in expanding its robotaxi service area in Austin to over 170 square miles. The company plans to launch its Full Self-Driving version 14 soon, potentially enhancing its autonomous capabilities. These developments indicate significant activity around Tesla’s strategic and operational initiatives.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.