Tesla stock (NASDAQ: TSLA) advanced on Monday, as investors positioned themselves ahead of the electric vehicle maker’s third-quarter earnings report scheduled for Wednesday, October 22.
The stock rose approximately over 2% to $448.32 in early trading, continuing a robust rally that has seen shares climb over 30% in the past three months and roughly 80% year-over-year.
This upward momentum reflects growing optimism around Tesla’s upcoming financial results and long-term artificial intelligence initiatives, even as Wall Street remains divided on the company’s lofty valuation.
Why Tesla stock is rising
The latest gains in Tesla stock are seen in the context of upcoming Q3 earnings release.
Wall Street expects Tesla to report earnings per share of $0.55 for Q3, down 24% year-over-year, with revenues projected at $26.33 billion, up approximately 5% from the prior year.
The anticipated earnings decline reflects margin pressure from price cuts and increased competition, particularly in China and Europe.
However, some analysts believe Tesla could beat these tempered expectations, especially if the company’s higher-margin energy storage division delivers strong results.
A Wedbush analyst noted that “after a brutal few quarters, we are finally starting to see stable demand trends for Tesla,” suggesting improved fundamentals heading into year-end.
Another significant driver of Tesla’s recent rally has been renewed investor enthusiasm for the company’s artificial intelligence and autonomous vehicle initiatives.
CEO Elon Musk’s proposed $1 trillion compensation package, contingent on Tesla reaching an $8.5 trillion valuation, has refocused attention on the company’s long-term AI ambitions.
Musk’s recent $1 billion personal stock purchase further reinforced confidence in Tesla’s strategic direction.
The company is aggressively pivoting toward AI, autonomous driving, and robotics, with Ives describing these initiatives as representing “an opportunity valued at no less than $1 trillion”.
What analysts say
Dan Ives from Wedbush, one of the biggest Tesla bulls on Wall Street doubled down on his Outperform rating, with a price target of $600.
That’s roughly 35% above where the stock is trading today.
Ives thinks the market is still way underestimating how big Tesla’s AI and autonomy pivot could be, and he sees the company hitting a $2 trillion valuation by early 2026 and possibly even $3 trillion by the end of that year if robotaxis and robotics scale the way he expects.
A analyst at Baird upgraded Tesla from Neutral to Outperform with a $548 target, pointing to multiple growth drivers, everything from the Optimus robot and robotaxi rollout to the Tesla Semi, the expansion of its energy business, and cheaper EV models in the pipeline.
Other firms have been raising targets as well: RBC bumped theirs from $325 to $500, while Canaccord lifted its target from $333 to $490.
Morgan Stanley is still overweight on the Tesla stock with a $410 target, citing confidence in Tesla’s latest delivery numbers.
Still, it’s not all broad consensus optimism. Overall, Wall Street’s stance on Tesla is still a “Hold.”
The average analyst price target sits at $363.54, which is actually about 17% below the current share price. Out of 45 analysts covering Tesla, 10 rate it a Sell, 12 say Hold, and 23 call it a Buy or Strong Buy.
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