Piper Sandler Reaffirms Tesla’s $400 PT Ahead of Q2 Earnings

Piper Sandler analyst Alexander Potter reiterated an Overweight rating and $400.00 price target on Tesla.

“Quantifying Regulatory Credits in the Trump Era: It’s Not as Bad as You Think; We frequently receive questions about Tesla’s regulatory credits, and for good reason: the company received ~$3.5B in “free money” last year, representing roughly 100% of FY24 free cash flow.

So it’s fair to ask: will recent regulatory changes threaten Tesla’s earnings outlook? In short, we think the answer is no, at least not in 2025. We think that while it’s true that the U.S. government is committed to rescinding financial support for the EV and battery industries, Tesla will still book around $3B in credits this year, followed by $2.3B in 2026.

This latter figure represents a modest reduction vs. our previous expectation, but the analysis on page 2 illustrates why, in our view, there’s no need for drastic estimate revisions.

Note that it’s difficult to forecast the financial impact of regulatory credits — even Tesla itself struggles with this — but the attached analysis represents an honest effort.”

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