Tesla stock eked out a gain on Wednesday, its fourth in a row, as investors continue to wait for robotaxis.
Anticipation is building. The Wednesday move follows a big gain on Tuesday that was fueled partly by the appearance of a driverless Tesla Model Y on the streets of Austin, Texas, and partly by signs of a potential reconciliation between Musk and the president.
On Wednesday, those headlines advanced further. CEO Elon Musk revealed that the company’s robotaxi service could start on June 22 and said he regretted some of the things he said about President Donald Trump.
Tesla stock gained 0.1% on Wednesday, closing at $326.40, while the S&P 500 fell 0.3% and the Dow Jones Industrial Average finished flat. Shares remained down about $18 from levels before the Trump-Musk feud erupted on social media.
A detente between the two billionaires would remove an overhang for Tesla stock. Shares of the EV maker fell 17% in the space of two days last week after disagreements between Musk and the president descended into a war of words on social media.
But the robo-taxi launch is a bigger deal for the future of Tesla’s business. Tesla stock rose 5.7% on Tuesday, closing near highs of the day, after a video emerged of a Tesla Model Y driving itself around Austin. It didn’t appear to have a paying passenger inside, but it was another sign that the company’s robotaxi service launch was imminent.
Musk said the launch was “tentatively” set for June 22, but added “we are being super paranoid about safety, so the date could shift,” in a post on X responding to a user who asked when public rides would start.
He added that a Tesla is set to drive itself from the factory to a customer’s house for the first time on June 28.
Shares of the electric vehicle maker have been strong in anticipation of the launch. Coming into Wednesday trading, Tesla stock was up 37% since the company reported first-quarter earnings in late April when management indicated the robotaxi launch was on schedule for June.
Bullish investors believe Tesla’s robo-taxi business can unlock a new wave of earnings growth. But the stock market is forward-looking, meaning shares tend to do better heading into a catalyst, like a new business, and then pause or even sell off when the catalyst actually happens.
“We expect the stock to sustain upward momentum in the coming weeks as more information is disclosed,” wrote Piper Sandler analyst Alexander Potter on Tuesday. “Pending any high-profile robo-taxi accidents, which would likely be met with violent downside.”
No accidents are a must early on for Tesla. Still, Potter sees more gains ahead, even after the recent run.
He rates shares Buy and has a $400 price target for the stock. Overall, 47% of analysts covering Tesla stock rate shares Buy, according to FactSet. The average Buy-rating ratio for shares in the S&P 500 is about 55%. The average analyst price target is about $308 a share.
Potter also noted that car prices rose 1% year over year in May, citing data provider Kelly Blue Book. “High car prices may be positive for Detroit automakers in the near term,” wrote Potter, pointing out that most car companies expected prices to decline in 2025. “But soon, high prices may prompt consumers to hail robo-taxis instead of buying cars.”
That is a consumer behavior to watch for in the coming years as self-driving cars become more common.
Maybe the robotaxi launch isn’t a ‘sell-the-news’ event after all.