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What gets the Tesla stock going again?


Baird analysts have conducted an in-depth analysis of Tesla (NASDAQ:TSLA) stock, given the recent struggles following the disappointing Q1 deliveries report.

With the automotive industry at a pivotal point as many investors free the sector given slowing demand, Baird analysts argue that Tesla remains at the forefront. The company’s leadership position is driven by innovation, strategic expansions, and a strong market presence.

Answering the question what gets Tesla stock going again, the analysts said:

“We speculate TSLA likely unveils both a robotaxi and a $25k vehicle. In the past TSLA shares have traded higher into these events and become a “sell the news” event,” analysts wrote in a note on Tuesday.

Baird’s analysis highlights Tesla’s continued growth potential, despite the challenges posed by increased competition. The research firm also discussed Tesla’s strategic moves to expand its global manufacturing footprint, with Gigafactories in Berlin and Shanghai ramping up production.

This expansion not only enhances Tesla’s production capabilities but also mitigates geopolitical risks and reduces dependency on single market fluctuations.

Tesla’s innovation pipeline is seen as a key driver for future growth. With the upcoming Cybertruck and the highly anticipated Roadster, Tesla is looking to attract a wider consumer base.

“We think TSLA continues to pull levers to increase demand pointing to continued pockets of soft demand.”

Moreover, advancements in battery technology and energy solutions, such as the Powerwall and Solar Roof, position Tesla as a leader in the sustainable energy sector, beyond its automotive achievements.

The analysts also discussed Tesla’s software and services segment, including Full Self-Driving (FSD) and over-the-air (OTA) updates. These services not only enhance vehicle functionality over time but also provide a continuous revenue stream and high-margin business model that differentiates Tesla from traditional automakers.

Despite these positive factors, Baird advises caution on TSLA stock due to the high valuation and potential market volatility. The firm suggests that while Tesla’s stock may face short-term fluctuations, its long-term trajectory remains promising based on the company’s innovative edge, expansion strategy, and leadership in the EV market.

Looking forward to the rest of 2024, Baird expects to see “minimal volume growth and likely a flattish to down year in EPS.”

The brokerage firm has an Outperform rating and a $280 per share price target on Tesla stock.

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