Street Calls of the Week
Investing.com - Barclays has reiterated its Equalweight rating on Tesla (NASDAQ:TSLA) with a price target of $350.00, according to a research note published on Thursday. The electric vehicle giant, currently valued at $1.46 trillion and trading near $439, appears overvalued according to InvestingPro analysis, despite its impressive 105% return over the past year.
The investment firm noted that Tesla’s recent earnings call provided few incremental updates but reinforced CEO Elon Musk’s vision of a "sustainable abundance driven by real-world AI" as the company focuses on validating opportunities for both its Robotaxi and Optimus robot initiatives. With a current P/E ratio of 260.65, Tesla’s valuation reflects high expectations for these ambitious projects.
Barclays described Tesla’s path over the next year as "ambitious" and characterized the opportunity as a "show me story," highlighting potential validation points including the removal of safety riders from Robotaxis in Austin by year-end and the demonstration of manufacturability for the Optimus V3 robot expected in 2026.
The firm expressed surprise at Tesla’s automotive gross margin miss and Musk’s discussion of increased production plans, particularly given potential demand risks following the expiration of the U.S. electric vehicle tax credit.
Barclays forecasts only modest volume increases next year with year-over-year margin deterioration, projecting 2026 earnings per share of $1.54, significantly below the consensus estimate of $2.40, while noting that traditional fundamentals may be less relevant to current Tesla investors.
In other recent news, Tesla’s third-quarter 2025 earnings report has drawn varied reactions from analysts. The company reported revenue of $28.1 billion, surpassing expectations by 6%, although its non-GAAP earnings per share of $0.50 fell short of consensus estimates by $0.06. Stifel maintained a Buy rating with a $483 price target, describing the results as "likely about neutral" due to mixed performance in revenue and earnings. Similarly, Mizuho raised its price target to $485, citing Tesla’s potential in AI and Full Self-Driving technology, while keeping an Outperform rating. On the other hand, Goldman Sachs reiterated a Neutral rating with a $400 price target, noting the automotive gross margin was below expectations. Wells Fargo maintained an Underweight rating with a $120 price target, pointing to the earnings per share miss and high operating expenses as concerns. Meanwhile, TD Cowen continues to support a Buy rating with a $509 target, focusing on the company’s advancements in autonomous vehicles despite near-term challenges. These recent developments reflect a range of opinions on Tesla’s financial health and future prospects.
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