Dear Tesla Stock Fans, the Next Big TSLA Catalyst Could Be Coming in September

Tesla (TSL) remains in focus today after billionaire CEO Elon Musk said the automaker is “training a new FSD model with ~10x params and a big improvement to video compression loss.”

According to his X post on Wednesday, the company plans on releasing the aforementioned Full Self-Driving model by the end of September.

Tesla stock has been rather volatile in recent months. At writing, it’s up more than 40% versus its April low but down over 10% versus its recent high.

Musk’s announcement is largely positive for TSLA stock because it reiterates the billionaire’s total commitment to the company’s AI future.

10x more parameters and improved video compression essentially means the new FSD model will offer better decision-making and real-time perception, key to advancing autonomous capabilities.

As Tesla continues to grapple with sales decline amidst rising competition, a breakthrough in Full Self-Driving could unlock new revenue streams, including robotaxi services.

Tesla shares are pushing to the upside following Musk’s update primarily because investors expect autonomy to be the main driver of the company’s future growth.

According to the latest industry data, Tesla’s new car sales declined by another 55% in the United Kingdom and Germany last month. Still, famed investor Jim Cramer remains bullish as ever on TSLA shares for the long term.

In a recent segment of Mad Money, the former hedge fund manager said Tesla is transitioning into a tech company and “the tech is worth a lot more than what it’s selling for right now.”

That said, investors should note that Tesla stock currently has a forward price-earnings ratio of more than 250x, which is sharply higher than the multiple on some of the best AI stocks like Nvidia (NVDA).

The valuation concern, together with a continued sales decline, is what’s keeping Wall Street analysts from turning positive on TSLA stock.

The consensus rating on Tesla shares currently sits at “Hold” only with the mean target of roughly $300 indicating potential downside of over 5% from current levels.