Tesla could surge 45% in price thanks to advantage over Waymo in robotaxis - analyst

Analyst Benchmark raised its target price on Tesla stock to $475, implying a 45% upside potential. He sees the recent launch of a robotaxi in Texas as the main catalyst, which he believes demonstrates the company's safe and scalable approach. The analyst also notes that Tesla is edging out rival Waymo, owned by Alphabet, due to its more cost-effective and efficient technology.

Benchmark analyst Mickey Legg raised his target price on electric car maker Tesla's shares from $350 to $475 and reiterated a buy recommendation, writes CNBC. The new target implies a 45% upside potential and assumes the company's capitalization reaches $1.53 trillion over a 12-month horizon, notesMarketWatch.  

That's now the second most optimistic Wall Street forecast for Tesla s value - after Wedbush's Dan Ives, whose target price is $500.

Analyst Benchmark cited the launch of Tesla's robot cab service in the Texas capital of Austin on June 22 in its assessment, calling it a catalyst for growth. For now, the service is only available to a narrow audience, and analysts were largely cautiously optimistic. «While the launch is still limited, we believe this approach demonstrates a controlled and safety-oriented approach,» Legg wrote.  

«Gaining the trust of regulators and public opinion is paramount - if successful, this will allow for rapid scaling. On September 1, new regulations for autonomous vehicles will go into effect in Texas, and we believe they will further help build confidence and pave the way for expansion into other cities,» the analyst said.

He also sees Tesla's advantage over its main competitor in autonomous vehicles, Waymo, which is owned by Alphabet. After the launch of Tesla's robot cab, analysts surveyed by Bloomberg said that the project had been undeservedly overshadowed, while Waymo's unmanned cabs have already traveled more than 71 million miles and offer paid rides in Los Angeles, Austin, Phoenix and San Francisco, as well as Atlanta via the Uber platform.

Legg, however, believes Tesla has a better value-for-money proposition: the average cost of a Waymo vehicle exceeds six figures, and is more expensive than producing a Model Y, he wrote. The analyst estimates that Ilon Musk's company's more cost-effective and scalable camera-based approach could outperform Waymo, despite the first mover's head start. 

Tesla's financial position appears strong and balanced, with excess free cash flow accumulated in recent quarters «providing plenty of opportunity to fund future growth areas,» Legg noted. «From our perspective, Tesla is in the midst of an evolution from a pioneering automaker to a high-tech automation and robotics company with unprecedented scale in the U.S.» concluded the Benchmark analyst.

Legg believes that the decline in Tesla's car deliveries in the second quarter was expected and already priced into the stock price. 

Baird analyst Ben Kallo previously predicted that the company's second-quarter electric car sales could be weaker than the consensus forecast at just 377,000 units, 13,000 fewer than the average Wall Street estimate, according to FactSet. By comparison, the company shipped 444,000 electric vehicles in the second quarter of last year.

Tesla sales in Europe collapsed in May for the fifth month in a row, data from the European Automobile Manufacturers Association showed: 8,729 new Tesla vehicles were registered - 40% fewer than in the same period in 2024. Moreover, the decline occurred despite the expansion of the European electric car market as a whole by 25%;

Tesla shares have sagged nearly 19% since the start of 2025. The presentation of unmanned driving technology in Austin, inspired investors, and quotes jumped sharply on Monday by more than 8%. They have fallen about 6% in the past three sessions. On Thursday, June 26, the company's securities fell slightly - within 0.1%.

This article was AI-translated and verified by a human editor