Barclays upgraded Tesla from Equalweight to Overweight and raised its price target to $450 from $370, citing improved core business performance and a potential combination with SPCX. The new target implies roughly 21% upside from the current stock price of $372.22, though the company trades at a premium P/E ratio of 409.
Tesla shares gained 2.1% in premarket trading.
The firm said recent dialogue around Tesla has focused on a potential combination with SPCX, which CEO Elon Musk acknowledged on last week’s SPCX and Tesla earnings calls. Barclays said a combination is heavily expected and should include a premium to Tesla stock.
Tesla’s auto business is on track to grow this year after two years of declines, with further upside expected in 2027 from demand driven by FSD and rising exports from Giga Shanghai. The company said its Energy business is nearly sold out for 2027 due to demand from data centers, which Barclays said could support growth in shipments exceeding 50%.
Barclays said Tesla’s Robotaxi business is showing signs of inflection after concerns over a slow ramp following the June 2025 launch. Recent weeks have seen a sharp increase in Robotaxi miles driven, alongside increased FSD uptake that reached over 75% on newly purchased Tesla vehicles in North America in the third quarter.
The firm said the improvement in Tesla’s core business and Robotaxi inflection, combined with the potential premium from a SPCX combination, offers attractive risk/reward for the stock. According to InvestingPro analysis, Tesla currently appears overvalued based on its Fair Value assessment. Investors can access comprehensive analysis through detailed Pro Research Reports, available for Tesla and 1,400+ other US equities, which transform complex data into actionable intelligence.
Comments