S&P 500 gains to extend record run, set for positive week
Investing.com -- Tesla’s second-quarter results offered a fresh look at the company’s deepening divide between fundamentals and narrative, according to Barclays (LON:BARC) analysts, who reiterated an Equal Weight rating and $275 price target on the stock in a note Thursday.
“The 2Q result further reinforced that gulf, begging the question of whether fundamentals may matter to the stock, at least for now,” Barclays wrote.
Despite an inline EPS and a beat on gross margins, the firm expects “near-term fundamentals to weaken post tax credit expiry, tariffs, reduced reg credit sales.”
Barclays said CEO Elon Musk continues to push a far-reaching AI narrative, stating that Tesla (NASDAQ:TSLA) is positioned as the “clear global leader in real-world AI,” driven by developments in Robotaxi and the Optimus humanoid robot.
Musk hinted at a new “master plan” and the potential for Tesla to “link arms” with his xAI venture to reinforce AI initiatives. “The narrative remains intact,” analysts said, even as concrete KPIs for Robotaxi expansion remain sparse.
Still, the firm flagged several short-term risks. “With the expiration of the U.S. EV tax credit at the end of 3Q, Elon Musk noted there could be a few ‘rough quarters,’” Barclays said.
Tesla also cited declining regulatory credit sales due to changes in emissions standards, as well as tariff impacts.
While a new low-cost model was discussed, Barclays suspects it may be “a decontented Model Y,” raising doubts about its ability to generate new demand.
“The focus remains on monitoring the ramp of Robotaxi,” the firm added, pointing to the November annual general meeting as a key event for reinforcing Tesla’s AI-driven story.
But, they concluded, “fundamentals don’t matter…until they matter.”