Tesla Inc. (TSLA) delivered a strong third quarter, exceeding earnings expectations and showcasing improved margins. The company also offered a positive outlook for vehicle deliveries in 2025, fueling optimism among analysts. Several analysts raised their price targets for Tesla stock, highlighting the company’s promising future.
Positive Sentiment Among Analysts
Piper Sandler analyst Alexander Potter reiterated an Overweight rating on Tesla with a $310 price target, citing the company’s unexpectedly strong quarter and room for upside. Potter is particularly optimistic about Musk’s prediction of 20%-30% delivery growth in 2025, potentially fueled by a new vehicle launch in the first half of the year.
Bank of America analyst John Murphy raised his price target from $255 to $265, emphasizing the robust gross margins and reduced operating costs in Tesla’s Q3 results. Murphy believes Tesla is poised for the next wave of growth, citing factors like the Cybertruck and Tesla Semi production, the launch of a public ride-hailing app, and overall unit volume growth projected at 20%-30% in 2025.
Cantor Fitzgerald analyst Andres Sheppard maintained a Neutral rating but raised his price target from $245 to $255, emphasizing the significance of Tesla’s confirmation of more affordable vehicle models in 2025. While Sheppard acknowledges the potential of Robotaxi and future plans, he remains cautious about the near-term valuation.
Morgan Stanley analyst Adam Jonas maintained an Overweight rating with a $310 price target, highlighting Tesla’s focus on reducing vehicle cost of goods sold and scaling its in-house battery business. Jonas believes the 2025 delivery growth depends on Tesla’s ability to make its vehicles more affordable through the next-gen vehicle launch.
Wedbush analyst Daniel Ives maintained an Outperform rating with a $300 price target, celebrating the strong margins and 2025 delivery guidance. Ives believes Tesla has successfully overcome the margin pressure faced in previous quarters due to a price war in China and softer electric vehicle demand. He sees the company’s 20%-30% delivery growth forecast for 2025 as a significant achievement, exceeding market expectations.
Other analysts, such as Needham’s Chris Pierce, Goldman Sachs’ Mark Delaney, and Truist’s William Stein, maintain cautious stances due to factors like price-to-earnings multiples, uncertainties surrounding FSD and the Optimus Bot, and the timing of the Robotaxi venture. However, they acknowledge the company’s positive performance and long-term growth potential.
Stifel analyst Stephen Gengaro reiterated a Buy rating with a $265 price target, recognizing the strong adjusted EBITDA, margins, and positive commentary from Tesla management. Gengaro believes Tesla is well-positioned for long-term growth, despite potential concerns from bears about lower average selling prices for Tesla vehicles.
Oppenheimer analyst Colin Rusch maintains a Perform rating, acknowledging Tesla’s strong automotive execution, which could provide time for AI advancements. Rusch highlights Tesla’s cost and technology leadership compared to other EV models. He questions whether Tesla can leverage its data, cost, and scale advantages effectively going forward.
Looking Forward: Tesla’s Path to Growth
Tesla’s Q3 earnings report paints a positive picture for the company, with improved margins, a bullish delivery outlook, and a renewed focus on cost reduction. The company’s ambitious plans, including the launch of new vehicles, the rollout of Robotaxi, and the production ramp-up of the Cybertruck and Tesla Semi, are expected to drive future growth.
While some uncertainties remain regarding the timing and execution of certain initiatives, the overall sentiment among analysts is optimistic. The strong performance in Q3 has reinvigorated investor confidence, and Tesla’s focus on profitability and innovation positions it as a leader in the rapidly evolving electric vehicle market.
