EV maker Tesla (TSLA) is in a transition phase, according to Yahoo Finance’s Opening Bid interview with Gradient Investments’ Lisa Schreiber. On July 23, Tesla reported second-quarter earnings that were weaker than last year, and CEO Elon Musk warned during the earnings call about several challenges ahead. He also said that Tesla will focus heavily on ride-hailing services and self-driving technology as part of its future plans. Nevertheless, the market reacted negatively, and Tesla’s stock dropped more than 8% after the announcement.
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Interestingly, it has become harder for investors to figure out in which direction Tesla wants to go. The company is still known for its groundbreaking work in robotics and artificial intelligence, but its main electric vehicle business is slowing down due to competition and Musk’s political involvement. It also does not help that the $7,500 federal tax credit for electric vehicles will end on September 30, 2025. As a result, Schreiber told Yahoo Finance that investors are not sure how to value Tesla and whether it should be viewed as a carmaker, a robotics company, or something in between.
For reference, Tesla’s stock is currently priced like a fast-growing tech company at around 161 times forward earnings. This is because Tesla wants to expand beyond cars. Indeed, it recently launched a robotaxi service in Austin, Texas. Musk also talked about the company’s humanoid robot, Optimus, and highlighted that both the robots and Tesla’s vehicles rely on similar AI systems. However, Schreiber warned that Musk has a history of big promises followed by delays. Therefore, she believes that it is best for investors to wait and see progress before considering Tesla as a buy.
What Is the Prediction for Tesla Stock?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 14 Buys, 15 Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $310.65 per share implies 5.3% downside risk.
