Tesla’s stock is trading near all-time highs, a notable achievement given recent downward revisions to its fourth-quarter vehicle delivery forecasts. This divergence highlights a significant shift in investor focus: from traditional automotive sales metrics to the long-term potential of its autonomous driving technology.
Institutional Profit-Taking Amid the Rally
Even as the equity climbs, notable institutional investors are capitalizing on the rally. ARK Invest, led by Cathie Wood, sold approximately 60,715 Tesla shares on Monday, valued at around $29.67 million. The firm indicated proceeds would be reallocated toward cryptocurrency investments. Despite these sales, Tesla remains the largest holding in several ARK exchange-traded funds, with weightings ranging from 9.71% to 12.5%.
Analyst Perspectives: Revised Targets and Cautious Optimism
This bullish sentiment is reflected in recent analyst actions. Canaccord Genuity significantly raised its price target for Tesla on Tuesday, moving from $482 to $551 per share and reiterating a “Buy” recommendation. The investment bank acknowledged lowered Q4 delivery estimates—now 427,000 units versus a prior 470,000—but pointed to “constructive developments beneath the surface.”
The primary catalyst for this optimism is progress in autonomous driving. Tesla has begun testing robotaxis without a safety driver in Austin, a milestone also recognized by Goldman Sachs as meaningful. However, Goldman maintains a “Neutral” rating with a $400 price target, citing potential competitive pressures that could limit future margins.
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The Autonomous Driving Thesis Takes Center Stage
The core calculation for bullish market participants is that Full Self-Driving (FSD) software and a future robotaxi network will become the company’s dominant growth engines in the coming years. Tesla’s plan to launch its ride-hailing service in 8 to 10 metropolitan areas is central to this vision. The unsupervised testing phase represents a critical step toward that commercialization.
Goldman Sachs analysts concur that autonomy, encompassing both FSD and robotaxis, will be crucial for Tesla’s long-term growth trajectory. They simultaneously cautioned against overestimating the near-term profitability of these ventures.
Market Looks Beyond Short-Term Operational Pressure
The broader market narrative appears to be looking past immediate operational challenges. Several analyst firms have recently trimmed their Q4 delivery projections, signaling acknowledged pressure on Tesla’s core automotive business. Nonetheless, investor enthusiasm for the company’s technological roadmap is currently overshadowing these short-term concerns, propelling the share price toward record levels.
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