Analysts change Tesla’s price target based on demand trends

If this continues, the only place you will be able to find a human driver will be in a museum.

Perhaps this is a slight exaggeration of the growing autonomous vehicle boom, but there have been some interesting things happening in the driverless car sector recently.

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In fact, the summer of ’24 saw steady AV developments in the US, according to S&P Global Mobility.

powered by Google (GOOGLE) Waymo continues to be the leader, S&P said, and this was underscored by Uber (UBER) announced on September 13 that the ride-hailing company is expanding its partnership with Waymo to offer robo-taxi rides in Austin, Texas and Atlanta starting in early 2025.

Uber will manage and ship a fleet of Waymo’s fully autonomous, all-electric Jaguar I-PACE vehicles, which will grow by hundreds over time, the companies said.

S&P noted that the National Highway Traffic Safety Administration (NHTSA) is investigating the Waymo incidents related to the potential for accidents, property damage and incidents of collisions with “clearly visible” objects.

Tesla prototype spotted

Meanwhile, outages at General Motors (GM) The Cruise AV division is proving to be a failure and perhaps a situation where lessons learned could leave the division in a better position, S&P said.

Founded in 2013, Cruise is looking to find its way back to US roads after an accident in San Francisco last year forced the company to halt operations. Earlier this year, it resumed testing with safety drivers.

Related: Tesla stock reacts to FSD roadmap ahead of robotaxi hype

Cruise will offer its autonomous vehicles on the Uber platform next year, the two companies said last month.

And then there’s Tesla (TSLA) which is scheduled to debut its robotaxi on October 10.

News outlets reported that a camouflaged car driving around the Warner Bros. studio property. it was recently a robotaxi prototype in disguise.

Electrek reported that the photo was first posted on Reddit by u/boopitysmopp, who is said to be heavily employed at Warner Bros., though the post has since been removed and the Reddit user deleted his profile.

The yellow color appears to be the car camouflage affixed to the vehicle along with additional body parts to hide the shape of the vehicle’s body.

“The October 2024 unveiling is expected to answer a number of questions about Tesla’s readiness to deploy true self-driving vehicle technology, but development of the vehicle program would be a multi-year effort and is not expected before the 2026-2027”. said S&P Global Mobility.

CEO Elon Musk has suggested that Tesla is considering an Air BnB-style or Uber-style implementation, where owners make their vehicles available for rent through a Tesla site but own and maintain the vehicles.

Earlier this month, Tesla said its advanced Full Self-Driving driver assistance software would be available in Europe and China next year, pending final regulatory approval.

Analyst resumes Tesla coverage

Musk has touted the profit potential of AI technologies, particularly around the company’s ambition to provide self-driving software to its global fleet of nearly 7 million electric vehicles. He also said that this year, capital spending will likely increase to about $10 billion.

Tesla continues to move away from its traditional electric vehicle manufacturing roots and toward cutting-edge products such as robotaxis powered by the company’s artificial intelligence technologies.

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Overall, electric vehicle registrations rose 18 percent in July from a year ago, thanks to the success of newer models like the Tesla Cybertruck and Honda Prologue, S&P Global Mobility said.

Tesla ended a five-month slump with a 1.2 percent increase in registrations, supported by 5,175 deliveries of the highly anticipated Cybertruck launched in November, CBT News reported.

The increase in registrations reflects the growing appeal of electric vehicles, aided by substantial incentives.

However, investment firms revised their price targets for Tesla, including Guggenheim Partners. The firm raised its price target on the company’s stock to $153 from $134 on Sept. 13, while maintaining a sell rating on the stock, according to The Fly.

Analyst Ron Jewsikow said the firm is expanding its assessment base to a year ahead, along with “modest improved demand trends,” while updating its delivery and margin forecasts to include quarterly data, a brief analysis of the vehicle market used for Tesla. and detailed regional assumptions.

“The path of least resistance to the 10/10 robotaxi event is probably higher, with deliveries looking like a non-event,” but in the wake of the robotaxi event, investors are likely to refocus on fundamentals in the short to medium term, Guggenheim said.

Tesla shares, which closed at $230.29, up 0.2%, are still down 7.3% year-to-date and 15.1% from a year ago.

Deutsche Bank analyst Ed Yu resumed coverage of Tesla on September 9 with a buy rating and a $295 price target.

In essence, the analyst said, “he doesn’t see Tesla as an automaker, but rather a technology platform that’s trying to reshape multiple industries, deserving of a unique kind of valuation framework.”

Tesla already has a structural advantage in battery electric vehicles, or BEVs, especially in terms of size/cost, and has exaggerated brand value globally, the analyst says.

While acknowledging that near-term auto deliveries and margins have been softer, Yu said he sees this as temporary ahead of upcoming new models and refreshes.

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