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On Thursday, TD Cowen reiterated its Hold rating on Tesla stock (NASDAQ:TSLA), with a steady price target of $180.00. The firm’s analysis followed Tesla’s fourth-quarter 2024 performance, which revealed margins falling short due to lower average selling prices in their automotive segment. According to InvestingPro data, Tesla’s gross profit margin stands at 18.23%, confirming these pressure points. The report also pointed to potential near-term margin pressures as Tesla ramps up production of its new Model Y, particularly notable given the company’s high P/E ratio of 96.84.
TD Cowen’s commentary highlighted that despite the lower-than-expected margins, investor attention was captured by Tesla’s product roadmap. CEO Elon Musk emphasized the company’s ambition to become the most valuable company in the world, fueled by the growth of its Robotaxi service and the Optimus project. With a current market capitalization of $1.25 trillion and annual revenue of $97.15 billion, Tesla’s ambitious goals reflect its position as a prominent player in the automotive industry. Musk provided an optimistic outlook for the future, including a target for launching an unsupervised Full Self-Driving (FSD) feature in Austin by June and an aggressive ramp-up plan for the Optimus robot, although the exact timing remains unspecified.Want deeper insights? InvestingPro subscribers have access to over 20 additional key insights about Tesla, including detailed valuation metrics and growth forecasts.
The report suggested that Musk’s reaffirmation of these forward-looking initiatives helped to bolster Tesla shares in after-hours trading. Investors seemed to respond to the company’s strategic direction and long-term projects, despite the immediate financial results not meeting expectations. InvestingPro data shows Tesla has delivered impressive returns, with a 103% gain over the past year, though 10 analysts have recently revised their earnings expectations downward.
Tesla’s focus on advancing its autonomous driving technology and expanding its product offerings with the Optimus robot are key elements of its strategy to drive future growth. The company’s confidence in these initiatives, as articulated by Musk, appears to have a noteworthy effect on investor sentiment.
While the current financial metrics show some challenges, Tesla’s ambitious goals for technological innovation and market expansion continue to play a significant role in shaping its market valuation. The maintained Hold rating and price target by TD Cowen reflect a cautious but watchful approach to Tesla’s stock amid these developments.
In other recent news, Tesla has reported its fourth-quarter and full-year 2024 financials, revealing an annual revenue of $97.15 billion. Despite robust financial achievements, the company fell short on revenue and margin estimates. Analysts from Stifel maintained a Hold rating on Tesla stock with a steadfast price target of $492.00, while Canaccord Genuity reiterated a Buy rating and a $404.00 price target. Piper Sandler continues to support Tesla with an Overweight rating and a $500.00 price target, whereas Baird revised Tesla’s stock price target to $440 but maintained an outperform rating. Jefferies maintained a Hold rating on Tesla stock with a consistent price target of $300.00.
Tesla has set strong expectations for production growth in 2025, particularly with the anticipated output of lower-priced models. The company also projects at least a 50% increase in energy storage deployments in 2025 and continues to make strides in the development of Full Self-Driving (FSD) and Robotaxi technologies.
Recent developments include the unveiling of a new autonomous driving feature within Tesla’s Fremont facility, indicating a step towards full self-driving capabilities. However, Tesla is also facing challenges, including a complaint from the Union of Swedish Electricians over alleged unauthorized electrical work at its charging stations and challenging the European Union’s tariffs on China-made electric vehicles.
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