Electric vehicle (EV) maker Tesla (TSLA) received a new street high price target from Wedbush Securities analyst Daniel Ives on Friday. Ives, a long-time Tesla bull, raised the price target for TSLA stock from $400 to a new range, with a base case scenario of $515 (18.1% upside) and a bull case price target of $650 (49% upside). The analyst cited substantial potential for Tesla’s autonomous driving and artificial intelligence (AI) offerings for his revised price target.
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Three Catalysts for Tesla’s Street-High Price Target
- Ives sees greater possibility and speed of acceptance for Tesla’s full self-driving (FSD) technology under Trump’s leadership. Billionaire founder and CEO Elon Musk has developed close ties with Trump and has been one of the biggest supporters of his presidential campaign. The five-star analyst believes that Trump’s legislative changes and relaxation of regulatory hurdles could be favorable for Tesla. Ives envisions that Tesla could capitalize on the $1 trillion opportunity in the AI and autonomous vehicle markets.
- Furthermore, Ives believes that Tesla’s market cap could reach $2 trillion by the end of 2025, with the help of a recovery in demand in China and advancements in its autonomous vehicles segment. Additionally, Tesla’s Cybercab project could also boost its valuation next year. What’s more interesting is that Ives’ model excludes any possible boost from Tesla’s Optimus humanoid robot project.
- Lastly, Ives noted that Tesla is set to launch a budget-friendly EV in early 2025, which could bolster its auto demand and competitive position in the market. The EV player is working on reducing production costs as it is gearing up to produce a cheaper EV model. Moreover, Tesla started shipping its Cybertruck in December, which is expected to boost its sales.
Overall, Ives believes that Musk could be one of the driving forces in the new regulations surrounding autonomous vehicles and AI under Trump’s administration. He also expects potential tariff carve-outs in trade negotiations next year, which could ultimately benefit Tesla. Ives’ bullish stance on Tesla stock and the catalysts mentioned above were reasons for the increased price target range on TSLA.
Is TSLA Stock a Buy Now?
Despite the catalysts highlighted by Ives, analysts prefer remaining on the sidelines on Tesla. On TipRanks, TSLA stock has a Hold consensus rating based on 12 Buys, 13 Holds, and nine Sell ratings. Also, the average Tesla price target of $267.79 implies 38.6% downside potential from current levels. Year-to-date, TSLA shares have zoomed 75.6%.
