Cantor Fitzgerald Lifts Tesla’s Price Target to $510
Cantor Fitzgerald analyst Andres Sheppard raised on October 23, 2025, Tesla’s price target to $510 (from $355), while maintaining an ‘Overweight’ rating on the stock.
“Our Thoughts – Cantor’s Take
Tesla beat sell-side aggregated consensus on 3Q Revenue, Gross Margin and FCF (though Adj. EPS was slightly below expectations), driven primarily by record quarterly vehicle deliveries, and Energy Generation and storage.
In 3Q, TSLA delivered 497,099 vehicles, which was not only significantly above consensus (~443K), but was also its highest quarterly delivery in company history (due primarily to “push-forward effect” from consumers who purchased or leased EVs ahead of the removal of the $7,500 EV tax credit, which expired on 9/30).
YTD, Tesla has now delivered ~1.2M vehicles globally, (though recall that it delivered ~1.75M vehicles in FY24), and we expect FY25 deliveries to be below FY24.
Still, we are encouraged by the recent introduction of lower-priced vehicles, which we see as an opportunistic way for TSLA to boost customer demand and potentially regain some EV market share.
Separately, TSLA also achieved its highest quarterly energy storage deployment in company history, which was driven by record deliveries of Powerwall deployments, and the ramp up of Shanghai’s Megafactory.
We are encouraged by this organic growth, and continue to expect material contributions from this segment to TSLA’s top line (generated ~3.4B in 3Q revenue, and we model FY25E and FY26E energy revenues of ~$12.9B and ~$18B, respectively).
In 3Q, TSLA disclosed that it had launched FSD (Supervised) in Australia and New Zealand, and that the company continues to prepare for a broader FSD rollout in China, and initial FSD launch in Europe, (subject to regulatory approval).
We see the upcoming FSD commercialization in China and Europe as material catalysts and accretive to margins. Regarding Robotaxis, Elon disclosed that TSLA is targeting to remove the safety driver in Austin, and to expand to “8-10 Metro areas” (within Nevada, Florida and Arizona), by year-end.
More importantly, TSLA disclosed that volume production of its Cybercab, Semi, and Megapack 3 are all on-track for FY26, (with production lines for Optimus also targeted for next year), which we see as significant.
Lastly, TSLA also disclosed that it expects a “significant increase” in capex for next year (we model ~$9.2B for FY25, and ~$12B for FY26).
Overall, we remain bullish on TSLA over the medium to long term, and we continue to see meaningful future upside from Energy Storage & Deployment, FSD, Robotaxis/Cybercab, Semis, and Optimus Bots.
We are reiterating our Overweight rating, and we increase our Price Target to $510 (from $355 prior).
However, with Tesla’s shares currently trading near its all-time high (and with a forward P/E >200x), we suggest new investors wait for a potential pullback to try and capture a better entry point.
Latest on FSD, Robotaxi and Cybercab – Targeting to Operate Robotaxis in “8-10 metro areas by Year-end.”
TSLA began operating its Robotaxi service in Austin on 6/23, with unsupervised Model Y vehicles carrying select passengers.
Later, on 7/10, TSLA announced its intention to expand its Robotaxi service to the San Francisco Bay Area, and to Arizona.
On 9/4, TSLA announced the launch of its Robotaxi app for the general public (available to anyone in the U.S and Canada).
TSLA recently launched its Robotaxis in the Bay Area and has expanded the territory in Austin three times since launching.
On its 3Q call, TSLA disclosed that it had launched FSD (Supervised) in Australia and New Zealand. Additionally, TSLA continues to prepare for a broader FSD launch in China, and the launch supervised FSD in Europe, (both of which are pending regulatory approval).
More importantly, TSLA reaffirmed that its cybercabs are on track for mass production next year, and Elon disclosed that TSLA is targeting to remove the Robotaxis safety driver and to expand to “8-10” Metro areas (within Nevada, Florida, and Arizona), by year-end (pending regulatory approval).
Overall, we continue to see Tesla’s Robotaxi segment as a software-as-a-service, high-margin model, and we expect TSLA to have the ability to rapidly scale following commercialization (pending regulatory approval).
Upcoming Potential Material Catalysts
- Broader FSD (supervised) Rollout in China – We expect 4Q25-1H25;
- Annual Shareholder Meeting – November 6;
- 4Q Vehicle delivery pre-announcement -Jan 2;
- Rollout of FSD (supervised) in Europe: We expect 2026 (pending regulatory approval);
- Robotaxi Market Expansion – 4Q25-1H26;
- Introduction of Cybercab – 2H26;
- Semi Truck (we expect SOP in 2Q26E and initial deliveries in 2027E);
- Optimus Bot (large-scale production 2026E, and we expect initial deliveries in 2H27E).
Introduction of Lower-Priced Vehicles: Timing is Opportunistic Following EV Tax Credit Expiration
Tesla recently unveiled its long-awaited lower-priced vehicles, which are more affordable variants of the company’s Model 3 and Model Y vehicles.
The new Model 3 Standard comes with a starting price of $36,990, while the Model Y Standard starts at $39,990 in the U.S.
These models strip back several features and scale back slightly on range and performance.
We believe TSLA’s introduction of its lower-priced models comes at an opportunistic time (with the EV tax credit now expired and EVs becoming more expensive), and we believe these vehicles can help boost demand and potentially help to increase EV market share.
A $1T Tesla Pay Package for Elon Musk to be Decided at Annual Shareholder Meeting in Couple of Weeks – Material Catalyst, in Our View
On 9/5, Tesla’s Board proposed a new 10-year compensation plan for CEO Elon Musk that could be worth up to ~$1T, (contingent on ambitious performance goals).
The package ties Musk’s potential payout to both market capitalization milestones (requiring Tesla to reach an $8.5T valuation) and key operational targets, including overseeing the commercial deployment of 1 million autonomous taxis and the deployment of 1 million robots.
Additionally, for Musk to receive the package, he will have to remain at Tesla for at least 7.5 years and 10 years to earn the full amount.
If approved, this would reaffirm Elon’s commitment to lead TSLA (positive for investors), as it completes its transformation from an automotive company into robotics and AI.
We expect the shareholder meeting to be a material catalyst.
3Q25 Key Financial Highlights
Top-Line Beat: TSLA reported 3Q25 revenue of ~$28.1B, above sell-side consensus of $27.8B (and vs. 3Q24 revenue of ~$25.2B), driven by 497,099 vehicle deliveries.
TSLA reported 3Q25 Adj. EBITDA of ~$4,227M.
Gross Margin Beat: Tesla reported 3Q25 GAAP gross margin of 18%, above sell-side consensus of 17.4% and an automotive gross margin (ex-regulatory credits) of ~15.4%.
Bottom-Line Miss: TSLA reported 3Q25 Non-GAAP diluted EPS of $0.50 below consensus of $0.59.
Free cash flow was $3,990M in 3Q25, above consensus of $1,235M.
Energy Generation and Storage – Highest on Record
TSLA reported ~$3.4B revenue from its Energy Generation and Storage Business in 3Q25 (vs. ~$2.4B in 3Q24), driven by deployment of 12.5 GWh (highest in company history), which was above consensus of 10.9 GWh, and vs. ~6.9 GWh in 3Q24.
This was primarily driven by a record deployment of Powerwall.
Valuation
We Reiterate Our Overweight Rating and Increase Our PT to $510 (from $355 prior)In our model, we are increasing our FY25 delivery estimates, and we now model FY25 deliveries of ~1.64M vehicles (from prior ~1.61M).
Additionally, we increase our Robotaxi assumptions to account for the upcoming expansion into 8-10 metro areas, as well as for total hours of operations and fleet size.
We also increase our margins to account for FSD commercialization and higher blended ASPs.
Separately, we model FY25 capex of ~$9.2B, and we increase our FY26 capex estimate to ~$12B (from ~$11B prior).
We arrive at our valuation via a 10-year bottom-up DCF.
Key Risks Include
- Tariffs,
- Competition from Chinese OEMs,
- Regulatory approval for FSD and Robotaxi, and
- Slowdown in EV demand.”
This research note is reproduced verbatim from the issuing firm. Price Target never edits, paraphrases or alters analysts’ words — we only republish them in one place.
