Tesla Motors (TSLA.US) shares climbed in pre-market trading on Friday following Baird's upgrade of the electric vehicle manufacturer from "neutral" to "outperform." The firm believes that despite potential near-term fundamental volatility for Tesla Motors, market sentiment has turned increasingly positive.
Analyst Ben Kallo emphasized: "Over the past several quarters, Tesla Motors has delivered lackluster performance, yet the stock's reaction has been relatively muted. Meanwhile, investor focus on the company's long-term plans continues to intensify—these two factors lead us to believe that the market's attention regarding Tesla Motors is increasingly shifting toward its future development potential."
Crucially, Kallo and his team suggest that the investment community is increasingly viewing Tesla Motors as a leader in the "physical AI" space. They identify Tesla Motors' key future catalysts as: the launch of the next-generation Optimus humanoid robot, expansion of robotaxi services in the U.S. market, introduction of more affordable vehicle models, and the upcoming shareholder vote on Elon Musk's compensation package.
This week, Wedbush Securities reiterated its "Outperform" rating on Tesla Motors (TSLA.US), with the core thesis being that investors are gradually looking past the company's near-term demand challenges and focusing on long-term value.
Morgan Stanley analysts also recently published research sharing their experience using Tesla Motors' (TSLA.US) FSD (Full Self-Driving) system for approximately 1,400 kilometers between Westchester County, New York, and Franklin County, Michigan. They praised the system for completely transforming the long-distance travel experience and suggested it could become a standard feature in the future. The firm maintains an "Overweight" rating on Tesla Motors stock with a target price of $410.
As of publication, Tesla Motors shares gained 1% in Friday pre-market trading to $421.42. Over the past six weeks, the electric vehicle company's stock has accumulated gains of over 25%.
Additionally, Tesla Motors will release its third-quarter (Q3) delivery report in less than two weeks.
