Barclays Maintains Tesla’s $360 Price Target

Barclays analyst Dan Levy reiterated on January 29, 2026, an ‘Equalweight’ rating and $360 price target on Tesla.

“Tesla kicked off its 4Q EPS call with an announcement that on the surface was of little meaning – Tesla will be ending production of Models S/X by next quarter.

Model S/X has been of little relevance for quite some time – in 2025 it accounted for only 2% of Tesla’s volume, with what many saw as little differentiation vs Models 3/Y.

Yet we’d argue that the announcement was more important from a symbolic standpoint.

When Tesla launched Model S in 2012, it was Tesla’s initial foray into high-volume vehicle production, and eventually paving the way for more affordable models in Models 3/Y – establishing Tesla as an incredibly disruptive force in the automotive industry.

While Automotive remains Tesla’s core business for the time being, we believe the end of S/X marks the symbolic baton pass for Tesla from Automotive and into Physical AI, with autonomy (Robotaxi, FSD) and bots to be Tesla’s core growth focus for the years to come.

In case it wasn’t clear before, it’s more than abundantly clear now that Tesla is not an auto company.

Paving the path for growth will be costly – and the more critical takeaway of the call was the sharp spike in capex Tesla will see in ’26, with guidance of $20bn+, more than double the $9bn Tesla spent in 2025.

And it won’t just be ’26 – with Elon Musk discussing the need for a Tesla TeraFab to ensure ample chip supply (an endeavor NOT reflected in the ’26 capex target), it’s a reminder that capex may very well be elevated for the years to come.

The elevated capex is a further amplification of the wild contrast for Tesla stock.

With this capex push and amid fundamentals which are soft for now, Tesla will likely for now be running with negative free cash flow, with the balance sheet to help with funding.

And yet even with negative FCF, Tesla stock is likely to remain frothy, currently trading at 200x ’26 PE multiple – an indication of how little near-term fundamentals matter.

As a reminder, Tesla is one of only two companies in the world with a USD $100bn+ valuation and a PE ratio of 150x or more (with the other being Palantir).”

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