Tesla Stock Positioned for Multi-Year Growth Despite Delivery Miss

A strong outlook for Tesla Inc (TSLA) is largely driven by anticipated new and revamped vehicle models alongside the potential of Full Self-Driving (FSD) licensing. This perspective comes even after the company reported a miss in fourth-quarter deliveries.

The Tesla Analyst: Stephen Gengaro, a well-regarded analyst, upheld a Buy rating for Tesla. In addition to this, he elevated the price target for the stock from $441 to $492.

Upcoming Models: In his recent note to investors, Gengaro identified the launch of the anticipated "Model 2" as a significant catalyst for future growth. He predicts strong demand for this lower-priced model, which is expected to make Tesla vehicles more affordable and accessible for a broader audience.

Additionally, he pointed out that refreshed versions of the Model 3 and Model Y may also positively impact sales. Gengaro remarked, "We believe Tesla is very well positioned to deliver robust multi-year growth in 2025-27+," highlighting an optimistic long-term forecast.

The analyst also suggested that the potential elimination of a $7,500 electric vehicle tax credit under the new administration could serve as a competitive edge for Tesla in comparison to its rivals.

Full Self-Driving and AI Potential: Beyond vehicle sales, Gengaro emphasized Tesla's efforts in Full Self-Driving and artificial intelligence. He believes these initiatives could unlock considerable value and revenues for the company. "We also believe Tesla's AI-based Full Self-Driving initiative has the potential to generate significant value through both sales of FSD, possible licensing agreements, and a critical part of longer-term Cybercab initiatives."

The increase in the analyst's price target follows a delivery miss and the company's first annual sales decline year-over-year. There is ongoing debate among analysts about Tesla's short-term and long-term prospects, focusing on new vehicle launches, robotaxis, and the Full Self-Driving program as key areas of interest.

Tesla is set to announce its fourth-quarter financial results on January 29, following market closure. As of the latest trading, Tesla's stock increased by 0.2% to $411.05, remaining within a 52-week trading range of $138.80 to $488.54, and the stock has appreciated by 71% over the past year.

Investment Outlook

Despite challenges such as recent delivery misses, the analyst’s bullish stance on Tesla remains strong, buoyed by factors like the upcoming Model 2, refreshed vehicle lineups, and advancements in autonomous driving technology.

Market Performance

Investors are keeping a close eye on Tesla as it prepares for a revealing quarter ahead. With expectations of continued innovation and new model introductions, many believe the growth trajectory for the company remains intact.

Tesla, Growth, Investment, Stock