Today brought an important update from autonomous driving leader Waymo, which confirmed that it has secured a new funding round, raising $5.6 billion. Formerly the Google Self-Driving Car Project, Waymo has been making advancements in the field of self-driving technology for years. Now, it is on track to accelerate this progress. For companies like Tesla (TSLA) that are looking to be the first to get a self-driving car to market, this development could be dangerous.
What Waymo’s Progress Means for Tesla
In a statement published on its blog, Waymo confirmed the closing of an “oversubscribed investment round” that netted $5.6 billion in new cash from Alphabet ($GOOGL, $GOOG), Andreessen Horowitz, and Fidelity, among others. The company confirmed that this funding influx will enable it to continue expanding robotaxi operations into cities such as San Francisco, Los Angeles, and Phoenix. Additionally, it will be able to expand its recent partnership with Uber (UBER) in Austin and Atlanta.
Why is this bad news for Tesla? After all, the electric vehicle producer just reported strong Q3 earnings, sending shares into the green. TSLA stock has been rising steadily since then and is currently up 24% for the past five days.
That said, Waymo is making significant advances toward corning the robotaxi market. Since Tesla is highly focused on beating them there, Waymo’s new funding round should raise concern. Its autonomous driving technology is gaining a presence in multiple cities across the U.S. Now Waymo has even more cash to continue these efforts and show even more drivers what its tech can do.
Is Tesla Stock a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 11 Buys, 16 Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. After 30% growth in its share price over the past year, the average TSLA price target of $207.83 per share represents a -22.46% change from current levels.
Even after Tesla’s recent earnings progress, Wall Street sentiment remains mixed. Autonomous driving isn’t the only factor that could impact TSLA stock in the near future. However, if Waymo continues expanding its reach, as it is well positioned to do, the EV leader will face an increasingly difficult battle as it works to get self-driving cars on the road.
