Piper Sandler has confirmed its Overweight rating on Tesla (NASDAQ: NASDAQ:TSLA) with a steady price target of $310. The affirmation comes as the firm adjusts its model in anticipation of the upcoming third-quarter earnings call set for October 23.
The adjustment reflects Tesla's Q3 deliveries, which surpassed the firm's initial estimates by several thousand units.
The firm's analyst noted that while last week's robo-taxi event showcased exciting developments, it is unlikely to affect Tesla's financials for 2025/2026.
The firm had hoped that the unveiling might provide a reason to raise estimates.
However, this optimism has waned, given that the impact of the robo-taxi technology on Tesla's financials is not imminent. Despite this, there is no need for downward revisions to estimates, as the firm had not expected significant revenue from Tesla's Full Self-Driving (FSD) software to start before 2027/2028.
As the market anticipates Tesla's earnings report, the unchanged price target suggests confidence in the electric vehicle manufacturer's current trajectory and its ability to meet or exceed delivery expectations in the short term.
In other recent news, Tesla has been the center of attention following its product announcement event, where it unveiled the Cybercab, Robovan, and Optimus. The event, which attracted over two million viewers, received mixed reactions from analysts.
Evercore ISI raised its target for Tesla to $195, maintaining an In Line rating, while HSBC initiated coverage with a "Reduce" rating, expressing concerns about Tesla's ambitious timelines for its new ventures. Stifel confirmed its Buy rating, and Piper Sandler maintained an Overweight rating, despite noting a lack of detailed information about the Full Self-Driving (FSD) technology.
Tesla recently announced plans to launch the Cybercab in 2026 and introduce unsupervised FSD in Texas and California by 2025. The company also converted 500 temporary positions into permanent jobs at its German gigafactory in Gruenheide, near Berlin. Despite these developments, firms such as Truist Securities, Morgan Stanley (NYSE:MS), and Oppenheimer maintain a cautious outlook.
However, RBC Capital expressed optimism for Tesla's long-term prospects, particularly regarding robotaxis and humanoid robots.
InvestingPro Insights
As Tesla gears up for its Q3 earnings call on October 23, InvestingPro data offers additional context to Piper Sandler's analysis. Tesla's market cap stands at an impressive $695.79 billion, reflecting its dominant position in the electric vehicle market. The company's P/E ratio of 56.24 indicates that investors are pricing in significant future growth, aligning with the analyst's long-term outlook on Tesla's robo-taxi and FSD potential.
InvestingPro Tips highlight that Tesla "holds more cash than debt on its balance sheet" and "liquid assets exceed short term obligations," suggesting a strong financial position as the company invests in future technologies. This financial stability could provide Tesla with the flexibility to continue innovating in areas like robo-taxis and FSD without immediate pressure for short-term returns.
However, investors should note that "8 analysts have revised their earnings downwards for the upcoming period," which may impact short-term expectations. Additionally, Tesla's stock "has taken a big hit over the last week," with a 1-week price total return of -9.56%, potentially reflecting market reactions to recent events and broader economic factors.
For those seeking a deeper understanding of Tesla's financial position and market sentiment, InvestingPro offers 20 additional tips, providing a comprehensive view of the company's strengths and challenges in the current market environment.
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