Despite significant headwinds and a notable decline in its stock performance this year, Tesla (TSLA) is still viewed by some prominent analysts as a compelling long-term investment opportunity. While the electric vehicle giant faces market skepticism fueled by recent sales figures and broader industry shifts, certain financial institutions maintain a distinctly bullish outlook, pointing to the company’s innovative ventures and foundational advantages beyond traditional automotive manufacturing.
- RBC Capital Markets reiterated an “Outperform” rating on Tesla stock, raising its price target to $319.
- Tesla’s stock has declined over 20% year-over-year, with Q2 car sales dropping 13.5% to 384,122 vehicles.
- RBC’s valuation methodology assigns premium multiples to Tesla’s energy storage (15x 2040 estimated EBITDA) and future ventures like robotaxi services (10x revenue).
- RBC projects Tesla’s revenue to reach $111 billion by 2026, an increase from an estimated $93.5 billion this year.
- Adjusted earnings per share (EPS) are forecast to grow from $1.99 in 2025 to $2.99 in 2026.
Analyst Confidence and Strategic Valuation
RBC Capital Markets, for instance, has reaffirmed its confidence in Tesla, reiterating an “Outperform” rating on the stock and raising its price target to $319. Analyst Tom Narayan articulated a strong belief in robust demand for Tesla’s diverse product portfolio, even amidst intensifying competition within the electric vehicle sector. He emphasized that the company’s established market leadership, consistent profitability, strong cash generation, and robust financial position provide a distinct competitive advantage for funding ambitious future growth initiatives.
RBC’s comprehensive valuation methodology underscores a strategic long-term perspective that extends beyond current automotive sales. While the core automotive business is valued at a standard 1x sales multiple, the firm assigns a significant premium to Tesla’s prospective revenue streams from advanced technologies. This includes a 15x multiple on 2040 estimated EBITDA for its Megapack energy storage systems and a 10x revenue multiple for anticipated future ventures such as robotaxi services and humanoid robot operations. This differentiated valuation approach highlights the perceived long-term potential beyond conventional vehicle sales, particularly in areas leveraging artificial intelligence and advanced automation.
Navigating Market Headwinds
However, the market’s immediate sentiment reflects considerable challenges and pressures. Tesla’s stock has experienced a decline of over 20% year-over-year and currently underperforms compared to other high-growth technology peers, including Nvidia (NVDA) and Meta (META). The company recently reported a 13.5% year-over-year drop in Q2 car sales, delivering 384,122 vehicles. This dip, alongside broader concerns about decelerating global EV demand and the public visibility of CEO Elon Musk’s political activities, has led some analysts, such as LPL Financial’s chief technical strategist Adam Turnquist, to anticipate further short-term pressure on the stock price.
Future Growth Trajectories and Market Dominance
Nevertheless, RBC’s projections anticipate a significant rebound in Tesla’s financial performance. The firm forecasts Tesla’s total revenue to reach $111 billion by 2026, marking a substantial increase from an estimated $93.5 billion this year. Adjusted earnings per share (EPS) are also projected to increase meaningfully, rising from $1.99 in 2025 to $2.99 in 2026. These gains are expected to be driven by expanding production capacity, the strategic introduction of new products, and higher-margin contributions from its non-automotive segments. The potential impact of its anticipated robotaxi service, in particular, could reignite investor enthusiasm for Tesla’s ambitious full self-driving capabilities and bolster future revenue streams. This long-term view is echoed by other prominent analysts, with Piper Sandler analysts calling Tesla the “most transformative company in autos” and predicting its eventual long-term market dominance.
Oliver brings 12 years of experience turning intimidating financial figures into crystal-clear insights. He once identified a market swing by tracking a company’s suspiciously high stapler orders. When he’s off the clock, Oliver perfects his origami… because folding paper helps him spot market folds before they happen.