Tesla’s stock price is expected to rise by 11.2% as analysts upgrade the electric vehicle maker due to favorable tailwinds under the new presidential administration. Analyst Vijay Rakesh lifted his price target to $515 from $230, citing idiosyncratic benefits and a lower EV cost structure relative to peers.
Rakesh believes Tesla’s autonomy software is improving towards commercialization, with a projected approval for Level 4 full self-driving technology by next year and in the European Union in 2027. This would generate licensing revenue. The analyst thinks Trump’s policies position Tesla better than its peers, allowing it to outgrow global EV sales.
However, Rakesh notes that domestic EV tax credit repeals may pose near-term challenges for the company. Nevertheless, he sees a positive catalyst in an easing regulatory framework around autonomous driving and improved competitiveness due to import tariffs from certain regions.
The stock has surged 84% since Donald Trump’s election win, driven by CEO Elon Musk’s close advisory relationship with the president. Tesla shares rose over 2.5% in premarket trading after the upgrade. Despite analysts being mixed on the stock, Rakesh’s upgraded forecast suggests a promising outlook for Tesla’s future growth.
Source: https://www.cnbc.com/2024/12/17/mizuho-upgrades-tesla-to-buy-citing-idiosyncratic-tailwinds-over-next-four-years.html