Tesla will report second-quarter results after the close of business on Wednesday, but Wall Street analysts have pressing questions about Elon Musk’s ambitions for the EV maker.
While Tesla’s delivery numbers have shown a recent rebound in sales, Tesla stock doesn’t reflect investors’ renewed bullishness. Its stock price has fallen 15% since the beginning of the year, making it the weakest stock in the Magnificent Seven.
Investors and analysts hope the second-quarter earnings report will provide insight into how Musk intends to reinvigorate the bullish mood later this year. Key to the bullish case are the introduction of robotaxis and humanoid robots, which optimistic Wall Street analysts increasingly see as a more important driver of future growth than vehicle sales.
This is also SpaceX’s first report since it went public in June, and investors are likely looking for answers about a possible SpaceX-Tesla merger.
Here’s what analysts are watching as Tesla prepares its report:
bank of america
BofA rated Tesla stock a “buy” ahead of earnings and maintained a price target of $391, about 2% higher than Tuesday’s price. Analysts at the bank see the introduction of robotaxis and optimizing the production of humanoid robots as important points to watch.
“We believe the revenue focus remains on TSLA’s robotaxi deployment,” BofA wrote. “TSLA is adding additional markets and expanding its TX fleet. We believe our core automotive business remains healthy, with second-quarter deliveries reported to be ahead of street prices, as TSLA gains global BEV market share.”
morgan stanley
Morgan Stanley analyst Andrew Percoco recently lowered his price target on Tesla slightly from $417 to $415, maintaining an equal weight rating. The price target implies a 9% upside from current levels. While he expects to see progress on some important fronts, he does not expect the report to provide an update on the key stories that will drive another surge in stock prices.
“While strong auto and energy supplies improve short-term fundamentals, we continue to believe robotaxis and Optimus will be the main drivers for the stock,” he said. “In terms of earnings, we expect constructive updates in both areas, but they may not be enough to prompt a definitive reassessment.”
oppenheimer
Analysts at the company say Tesla’s transition to a leader in “physical AI” will require significant capital investment to acquire the necessary computing power and memory capacity.
“We expect investors to begin to focus on capital expenditures as a leading indicator of success for physical AI,” Oppenheimer analysts said.
The company recently raised Tesla’s annual capex outlook from $18 billion to $20 billion, predicting that Tesla will “aggressively bring capacity online to enable AI-driven learning cycles around product design, manufacturing processes, and software integration into products.”
Oppenheimer rates Tesla a “performer” and has not set a price target for the next 12 to 18 months.
barclays
Barclays is less bullish on Tesla stock than some of its Wall Street peers, maintaining a weight rating equal to its $370 price target. Analysts noted that the company’s auto business was improving, but raised questions about how important it would really be going forward.
“We believe the key message from the market regarding Tesla’s foam multiple is that Tesla’s current revenue streams (mainly cars) are increasingly irrelevant and the stock’s focus is on future mega-growth initiatives in AI such as robotaxis/FSD/self-driving+bots/Optimus humanoids,” Barclays wrote.
cantor fitzgerald
Tesla shares have an equal weight rating and a price target of $510, up 34% from current levels, making Cantor Fitzgerald one of the biggest bulls as the company prepares for its report. Analyst Andres Shepherd highlighted the company’s vehicle delivery wins and robotaxi rollout successes, noting that his team expects continued progress.
“Overall, we continue to see Tesla’s robotaxi division and CyberCab as a high-margin model for software-as-a-service,” he said. “We continue to expect that TSLA has the ability to rapidly scale and capture meaningful market share (despite expansion delays) post-commercialization.”