Tesla Stock Forecast: Trending Analyst Sees Upside Potential

Tesla (TSLA) stock has fallen 4.0% over the past week and is down 5.1% for the past month, but it still shows a 10.9% gain over the last 12 months. Despite recent volatility, Wall Street’s analysts currently sit at a Hold consensus, with an average 12-month price target of $402.47 versus the last closing price of $431.46. That implies a modest downside over the next year, signaling that analysts, on balance, see the shares as fairly valued after a strong run.

Within this mixed backdrop, some experts remain upbeat on Tesla’s long-term story. Analyst Ben Kallo of Baird Equity Research reiterated his Buy rating on TSLA on January 28, 2026, with a bullish price target of $548 per share, well above the current level. His view stands in contrast to the broader Hold consensus, suggesting he expects Tesla’s aggressive investment strategy and new product cycle to unlock meaningful value that the market may not yet fully appreciate.

Kallo’s report highlights Tesla’s transition into what he calls a “major investment phase,” with capital expenditures expected to more than double from roughly $9 billion to over $20 billion in 2026. Management plans to build out what they describe as a “physical AI value chain,” including the Optimus robot production line, expanded solar and battery capacity, the Cortex 2 platform, and a broader factory footprint. While this will likely mean a $4–$6 billion drawdown from Tesla’s sizable $44.1 billion year-end cash balance, Kallo views these moves as the beginning of a new chapter for the company rather than a short-term drag.

The analyst also points to several strategic shifts that could reshape Tesla’s business mix. The company plans to shutter its Model S and X production lines after next quarter to make room for a 1 million-unit Optimus robot line targeting year-end production. Tesla has invested $2 billion into xAI through preferred shares and signed a framework agreement to pursue AI opportunities together, tightening the links across Elon Musk’s ventures. On top of that, Tesla is targeting an ambitious 100 gigawatts of solar capacity, reinforcing the idea that solar and batteries will be central to powering data centers and the broader energy grid.

Kallo believes energy storage will be a major contributor to Tesla’s profit and cash flow in 2026, aided by increased capacity and the new Megapack 4 product. He expects this year to be a “year of commercialization” for a host of long-developed products, including Cybercab, Robotaxi Service, Tesla Semi, and Optimus, which could drive meaningful revenue growth in the following years even if they are not yet material near term. According to TipRanks, this higher-risk call comes from an analyst ranked 2051 out of 11,984, with a 44.24% success rate and an average return of 6.5% per rating. Never miss a stock rating. Find all the latest ratings on TipRanks’ Top Wall Street Analysts page.