Tesla stock had a rocky start in 2025 with the share value down more than 20% in the first six months. However, things changed dramatically in Q3, and Tesla (TSLA) outperformed every other Big Tech company, pushing the share price up by 10% since the start of the year.
Investors are seemingly focusing more on the brand's longer-term prospects, enthused by expectations around Tesla's autonomous vehicle and robotics initiatives, Elon Musk's new pay proposal, and substantial stock purchase by the CEO. These factors have driving investor sentiment, boosting the stock value.
Analysts, too, revised their stance as the underperforming share got a significant boost. "The Tesla story going forward is around the AI transformation led by the autonomous and robotics initiatives," remarked a group of bullish analysts from Wedbush.
Though the stock prices have seen a slight dip since the beginning of the month, they remain far above the consensus price target set by Wall Street analysts. This presents a challenge for investors weighing the company's quarterly results and potential long-term opportunities.
Nonetheless, anticipation is high for Tesla's third-quarter earnings due Wednesday afternoon. The company has already reported better-than-expected deliveries for the quarter. The release will undoubtedly draw attention to any new information regarding car demand, given the recent updates to Tesla's vehicle lineup.
However, Wall Street remains cautious. The mean price target on Visible Alpha sits around $365, 17% off from Friday's closing figure. Furthermore, Tesla has underperformed the Magnificent 7 ETF (MAGS) this year, despite its Q3 surge.
Looking at the broader tech landscape, Tesla's Q3 earnings will set the stage for the rest of the Magnificent 7 tech giants' reports, thereby kicking off the Big Tech earnings season.