Tesla stock rating held by Needham, citing fair valuation despite leadership

Investing.com - Tesla (NASDAQ:TSLA) maintained its Hold rating from Needham on Thursday, with analyst firm reiterating its position following Tesla’s third-quarter results. The electric vehicle giant, currently valued at $1.46 trillion, trades at a P/E ratio of 260, reflecting high market expectations.

Needham acknowledged Tesla’s operational discipline and long-term leadership in electrification and energy storage sectors, but considered the stock fairly valued against what it described as "already aggressive longer term FSD and Robotics estimates." According to InvestingPro data, Tesla maintains strong financial health with a current ratio of 2.04 and annual revenue of $92.72 billion, though its gross margin stands at 17.48%.

The firm noted Tesla’s decision to scale vehicle production indicates higher confidence in its Full Self-Driving (FSD) platform, but expressed caution about the lack of "distinct real world proofpoints" for the company’s Robotaxi platform. InvestingPro analysis suggests Tesla is slightly overvalued at current levels, with 18 additional key insights available to subscribers.

Needham pointed out that Tesla’s autonomous vehicle technology still relies on safety drivers, while competitors are expanding driverless operations in various geographic areas.

The analyst firm also mentioned high expectations for the upcoming Optimus version 3 unveiling, concluding that at current prices, market enthusiasm for Tesla’s future prospects is "more priced in than not."

In other recent news, Tesla reported revenue of $28.1 billion for the third quarter of 2025, surpassing Street expectations by 6%, although its non-GAAP earnings per share of $0.50 fell short by $0.06 compared to consensus estimates. The automotive non-GAAP gross margin was reported at 15.4%, slightly below the anticipated 16%. Following these earnings results, Mizuho raised Tesla’s stock price target to $485, citing potential in AI and Full Self-Driving (FSD) technologies, while maintaining an Outperform rating. In contrast, Canaccord Genuity lowered its price target to $482 from $490, adjusting for higher operating expenses, yet still retained a Buy rating. Stifel also reiterated a Buy rating with a $483 price target, describing the quarterly performance as neutral for the stock. Meanwhile, Barclays maintained an Equalweight rating with a $350 price target, emphasizing the company’s focus on AI-driven opportunities like Robotaxi and Optimus. Additionally, Goldman Sachs kept its Neutral rating and set a $400 price target, acknowledging the revenue beat but noting the shortfall in earnings per share. These developments reflect the diverse perspectives among analysts regarding Tesla’s financial performance and strategic initiatives.

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