Tesla stock price target raised to $509 from $374 at TD Cowen

Investing.com - TD Cowen has raised its price target on Tesla (NASDAQ:TSLA) to $509.00 from $374.00 while maintaining a Buy rating on the electric vehicle maker’s stock. The target sits well above the current trading price of $431.32, though analyst targets range widely from $120 to $600, according to InvestingPro data.

The price target increase follows Tesla’s significant third-quarter delivery beat and continued progress in autonomous vehicle and artificial intelligence development, according to the research firm. The company, currently valued at $1.43 trillion, has demonstrated strong momentum with an 82% return over the past year.

TD Cowen cited the product goals outlined in the recently proposed CEO compensation package as a factor that increased its confidence in Tesla’s long-term story, which is now reflected in the higher price target.

The firm updated its financial model to reflect the third-quarter deliveries and recent data points, resulting in slightly higher 2025 earnings per share estimates and minor upward revisions to out-year projections.

TD Cowen’s new DCF-based price target includes an increased EBITDA terminal value multiple of 30x, up from the previous 15x, reflecting added confidence in Tesla’s autonomous vehicle deployment potential and what the firm describes as "scarcity value for AV deployment exposure."

In other recent news, Tesla has been under scrutiny as the National Highway Traffic Safety Administration (NHTSA) launched an investigation into 2.88 million vehicles equipped with its Full Self-Driving system. The investigation focuses on potential traffic safety violations, as the system reportedly induced vehicle behavior that violated traffic laws. Meanwhile, Tesla has introduced new lower-cost "Standard" variants of its Model 3 and Model Y vehicles in the U.S., with prices starting at $36,990 and $39,990, respectively. These variants come with fewer amenities, such as no panoramic roof or ambient lighting, and aim to provide more affordable options for consumers.

Additionally, Tesla plans to unveil a more affordable Model Y variant to counteract the loss of a federal tax credit that was recently discontinued. In Germany, Tesla’s sales saw a decline of 9.4% in September, with a more significant drop of 50.3% in sales from January to September compared to the previous year. On another note, a survey by Bernstein highlighted that Tesla maintained its position as the second most recognized electric vehicle brand in China, following BYD. Xiaomi made a notable leap to third place, despite only entering the electric vehicle market in 2024.

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