Tesla Gets New Street-high Target Following FSD V13 Rollout. What's Next?
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FSD's Remarkable Updates and New Street-high Target
Investors have been keenly following the progress of Tesla's FSD, particularly due to its implications for the future launch of the RoboTaxi. According to Tesla AI team member Yun-Ta Tsai, the new FSD V13 is 'the biggest rewrite since we embarked on our photon counting journey four years ago.' Tsai stated that FSD V13 constitutes a complete overhaul of the system, with enhancements from V12 to V13 being more substantial than previous updates from V11 to V12. He likened the clarity and performance of V13 to that of SpaceX's Raptor Engine V3, used in the Starship spacecraft.
During Tesla's third-quarter earnings call, Musk expressed his expectation for achieving fully autonomous, unsupervised FSD in California and Texas by next year for the Model 3 and Model Y. The updated FSD version 13 is touted to reduce the need for driver intervention sixfold. This significant improvement is viewed as a pivotal development that could accelerate the deployment of Tesla's RoboTaxi service.
In response to these developments, Stifel has significantly raised Tesla's target stock price from $287 to $411, maintaining a Buy rating and emphasizing that Tesla is 'not just an automaker.' Stifel indicates to investors that the significant value creation potential from Tesla's AI-based full self-driving capabilities and Cybercab robotaxi underpins its positive outlook.
Additionally, Roth MKM upgraded Tesla's rating from Neutral to Buy and adjusted the target price from $85 to $380, arguing that Musk's 'authentic support for Trump likely doubled Tesla's pool of enthusiasts and lifted credibility for a demand inflection.' The firm highlights a transformative global landscape and praises Tesla's principal AI objective of developing a smarter copilot to handle exponentially more complex situations than competing products. It also notes that Tesla's CyberTaxi initiative is poised to benefit from a more favorable regulatory climate.
Potential Catalysts for Tesla'sStock: Tesla Investment Calendar
Key upcoming events that could influence Tesla's stock price include further updates on FSD, the RoboTaxi program, the Optimus project, and any deregulatory moves during Trump's presidency that might favor self-driving technology. Investors are also anticipating the production start of the Optimus robot in significant numbers following design improvements and the scaling of its supply chain, as mentioned by Musk on Twitter and at Tesla's annual shareholder meeting. Additionally, Musk's comments at the 2024 shareholder meeting about increasing Cybertruck production to 2500 units per week by year-end and the potential re-emergence of the more affordable rear-wheel-drive Cybertruck previously listed at $60,990 are being closely watched.
In January, Tesla is scheduled to release its Q4 production and delivery figures on January 2, followed by the earnings release for 2024 on January 24. Moreover, significant management changes are expected in the United States on January 20th, 2025, a factor that could influence Tesla's operations, especially since Musk has a forthcoming role in the Department of Government Efficiency. Any hints of governmental favoritism towards Tesla in Trump's speeches could further elevate the company's stock price.
Looking into the first quarter of 2025, Tesla aims to introduce its advanced driver assistance system, known as Full Self-Driving technology, in China and Europe, pending regulatory approvals. The approval of FSD in these regions would be a strategic win for Tesla, particularly in China—its largest overseas market, where numerous brands are challenging Tesla's dominance and developing their own advanced driver assistance technologies.
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