Baird raised its price target for Tesla Inc (NASDAQ:TSLA) to $480 from $280, on strong growth prospects in the automaker, supported by cost reductions, new models, and favourable regulatory dynamics.
“The stock has gained significant momentum and has several upcoming potential catalysts. We like the stock long term and would be buyers on pullbacks,” analyst said.
Tesla's stock has surged nearly 91% since the U.S. presidential election, far outpacing the S&P 500's 4.6% gain.
A potential regulatory fast track for the Cybercab, the rollout of affordable vehicles, and Musk's ties to President-elect Trump has Baird bullish on Tesla’s outlook for 2025.
Baird expects Tesla’s cost-cutting measures and increased factory utilization to drive growth, while regulatory credit sales could remain a sustainable revenue stream as competitors face production challenges.
However, the removal of U.S. EV tax credits and geopolitical risks linked to Tesla's Shanghai operations pose risks, alongside concerns about CEO Elon Musk’s ability to balance multiple roles.
Baird’s $200 lift in price target reflects a premium valuation of 57 times 2028 EBITDA estimates, discounted to 2025, which brokerage modelled factoring Tesla's growth potential and industry tailwinds.
