Tesla Stock Is Trending Tuesday: What's Going On?

Tesla Inc TSLA shares are in the spotlight Tuesday ahead of earnings this week. Here’s a look at what you need to know.

What To Know: Tesla is due to report financial results for the second quarter after the market close on Wednesday. The company is expected to report earnings of 42 cents per share and revenue of $22.79 billion, according to estimates from Benzinga Pro.

In the first quarter, Tesla missed analyst estimates on the top and bottom lines. Total revenue fell 9% year-over-year as automotive revenue dropped 20% due to a decline in deliveries, Model Y updates and lower average selling prices.

Tesla didn’t provide guidance last quarter, but noted that the company would “revisit” 2025 guidance when it reports second-quarter results. The automotive business isn’t likely to be the focus this quarter, according to Wedbush’s Dan Ives, who reiterated an Outperform rating and price target of $500 on Tuesday.

Ives said in the new note that investors will be focused on the AI initiatives that Tesla is working on, including robotaxis and the company’s Optimus humanoid bots.

Tesla CEO Elon Musk said in May that autonomous and robotics would “overwhelmingly dominate” Tesla’s future financial success. Tesla officially launched its robotaxis in Austin last month.

“It starts with autonomous then robotics,” Ives said on Tuesday.

The Wedbush analyst recently called on Tesla’s board to establish 25% voting control for Musk, which he believes would create a path for a potential merger between Tesla and Musk’s xAI. Ives noted that investors will be listening for any updates on a potential xAI investment on Tesla’s earnings call on Wednesday.

Other analysts are less optimistic heading into Wednesday’s print with Goldman Sachs cutting its target from $315 to $285 and Mizuho lowering its target from $390 to $375 earlier this month. Guggenheim also maintained a Sell rating at the beginning of the month with a price target of $175.

TSLA Price Action: Tesla shares were up 1.07% at $332.01 at the time of publication on Tuesday, according to Benzinga Pro.

Tesla stock is trading above its 50-day moving average of $324.98, indicating a bullish short-term trend. The stock is also trading above the 200-day moving average of $318.48, suggesting overall strength in the longer-term trend. Despite gaining nearly 40% over the past three months, Tesla shares are still down about 18% year-to-date.

Tesla’s P/E ratio of 187.71 indicates a high valuation relative to earnings, reflecting strong market expectations for future growth. With a market cap of $1.06 trillion, Tesla remains a dominant player in the electric vehicle sector, though much of its valuation is centered around the company’s AI ambitions. Ives said on Tuesday that Tesla’s autonomous initiatives are worth $1 trillion alone over the next few years.

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Photo: courtesy of Tesla.