Wedbush Securities analyst Dan Ives, a longtime Tesla bull, early Friday raised his Tesla stock price target to 500, up from 350, representing 46% upside as he believes "the golden age of autonomous is now on the doorstep for Tesla" with the EV giant poised to launch a limited robotaxi service in Austin, Texas, next month. TSLA shares angled lower Friday amid broad stock market losses.
Ives wrote Friday that "2025 started off as a dark chapter" for Chief Executive Elon Musk and Tesla with Musk's political work in the Trump White House resulting in "brand damage and a black cloud over the story."
"But importantly those days are in the rearview mirror as we are now seeing a recommitted Musk leading Tesla as CEO into this autonomous and robotics future ahead with his days in the White House now essentially over," Ives said.
"While there is still some wood to chop to turn around Model Y growth in China and Europe, we believe the core focus for investors is the AI Revolution is now coming to Tesla," he added.
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Ives increased his price target on Tesla stock based on the company being "one of the best pure plays on AI over the next decade along with Nvidia, Microsoft, OpenAI, Palantir, Amazon, Meta, and Alphabet."
"The vast majority of valuation upside looking ahead for Tesla is centered around the success of its autonomous vision taking hold with a key June launch in Austin," Ives said.
Tesla stock declined 0.5% to 339.34 during Friday's stock market action, after gaining 1.9% to 341.04 on Thursday. TSLA finished Friday down 3% on the week but up 20.3% in May.
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Tesla is preparing to launch the limited robotaxi service in Austin next month. After meeting with Tesla last week, Morgan Stanley analyst Adam Jonas said in a note to clients that this will likely be around 10 to 20 cars, on public roads and be invite only with plenty of tele-ops to ensure safety levels.
Musk, speaking with CNBC on Tuesday, said that there will probably 10 robotaxi Model Ys in the first week and that there could be 1,000 in a "few months."
The Tesla chief did not give a specific date for the rollout but said it would come before end of June. Musk confirmed there will be human supervisors of the autonomous trips and that the robotaxi service will be geofenced, meaning the entirety of Austin will not be available.
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This comes after Musk said during the first-quarter earnings call in April that Tesla was still debating what the robotaxi service would look like but that there will be "maybe 10 to 20" vehicles on day one.
Meanwhile, Musk also made it clear on the first-quarter conference call that the robotaxi vehicles in Austin will be Model Ys.
"We expect to be selling fully autonomous rides in Austin in June," Musk said. "The team and I are laser focused on bringing robotaxi in Austin in June," adding that "unsupervised autonomy will first be solved for the Model Y in Austin."
Separately, the CyberCab product is on track for production next year, according to Tesla. The CyberCab will use the "unboxed" manufacturing system (a modular approach). Tesla executives said on the company's first-quarter earnings call that the unboxed process is "progressing," suggesting it's not yet ready.
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Tesla Stock Performance
TSLA is up 20% in May. On May 9, shares blasted above the 200-day moving average, offering investors an aggressive entry. Shares are still down about 15% this year as of Thursday's stock market close, despite surging on robotaxi bets following the Q1 conference call. Shares are also still down around 30% from the 488.54 peak on Dec. 18.
"We've lost some sales perhaps on the left but we've gained them on the right," Musk said in an interview Tuesday at Bloomberg's Qatar Economic Forum in Abu Dhabi, referring to left-wing and ring-wing consumers.
"The sales numbers at this point are strong and we see no problem with demand," Musk added.
Musk cited TSLA stock as evidence that Tesla EV sales are doing well.
"Our stock wouldn't be trading near all-time highs if things weren't in good shape, they're fine, don't worry about it," Musk added.
Troy Teslike posted to X on Wednesday that he expects Q2 vehicle deliveries between 350,000-395,000, or marking about a 11%-20% decrease vs. a year ago. For the full year, Teslike expects Tesla vehicle deliveries to decline more than 16%. Teslike's delivery estimates are highly respected among retail investors.
Tesla stock has a 21-day average true range of 5.25%. The ATR metric is available on IBD's MarketSurge charting tool that gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
The S&P 500 and Nasdaq now in a power trend. Investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
Tesla stock has a 79 Composite Rating out of a best-possible 99. Shares also have a 94 Relative Strength Rating and a 58 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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