The next chapter of the Tesla (NASDAQ:TSLA) story is now underway, Wedbush analysts said Friday.
With most price cuts behind and a global stabilization in demand for electric vehicles (EVs), particularly in China, they believe Tesla is on track to achieve an annual production rate of 2 million units in the coming quarters, a trajectory expected to be driven by clear momentum and more favorable comparisons heading into 2025.
“The key for Tesla's stock looking ahead is the Street recognizing that Tesla is the most undervalued AI play in the market in our view with a historical Robotaxi Day ahead for Musk and Tesla on August 8th that will lay the yellow brick road to FSD and an autonomous future,” analysts wrote.
Wedbush analysts believe that the crucial catalyst for Tesla to reach a valuation of $1 trillion lies in the adoption of its autonomous and full self-driving (FSD) vision, which appears to be gaining momentum with the latest FSD v12.4 and the initiation of FSD testing in China.
Tesla's long-standing commitment to full self-driving, which was first mentioned in connection with robotaxis in 2019, is now becoming a reality, analysts noted. It is official that robotaxis will be part of Tesla’s portfolio, with the first Tesla robotaxi set to be unveiled on August 8th.
Elon Musk has previously stated that Tesla aims to produce a car without human controls, envisioning FSD reaching a level of full autonomous use for taxi and driverless scenarios.
Wedbush’s team thinks that, in a bullish scenario, Tesla's FSD segment alone could be worth $1 trillion.
“In a nutshell, the worst is in the rear-view mirror for Tesla as we believe the EV demand story is starting to return to the disruptive tech stalwart ahead of a historical Robotaxi Day on August 8th with the bears now heading back into hibernation mode and their caves.”