UBS Raises Tesla Price Target to $425

UBS analyst Joseph Spak raised the price target on Tesla (NASDAQ: TSLA) to $425 (from $391) while maintaining a Neutral rating.

“TSLA’s 3Q26 update was positive, in our view.

We are raising our 27/28E EPS to $2.02 /$3.17 from $1.80/$2.92, Key factors are 1) strong uptake on FSD in NA (75% of NA deliveries took FSD, +20pp q/q) and potential for approval in regions like EU shortly.

2) Energy demand strong from rising data center demand with ’27 Megapack capacity nearly sold out. Both 1) and 2) are margin accretive. Another positive is Robotaxi is scaling, albeit from low-levels.

We don’t believe Robotaxi will be financially material until late ’27 or 2028, but progress can be positive for sentiment.

However, the large investor focus is on a potential combination with SpaceX after Elon Musk on SpaceX’s 3Q26 EPS call noted that both Space X and Tesla have formed special committees at the request of shareholders to discuss the idea of a merger between the two companies.

While Musk thought it would be a “good idea” he also said considering it a certainty would be “overstating it” and alluded to some hurdles.

Musk wouldn’t address the situation further on the Tesla call vs. the SpaceX call where he did. Many questions remain outstanding. See inside for some additional thoughts on the matter.

We are raising our PT to $425 on higher numbers, but we do believe the stock will mostly trade with evolving views and sentiment on a potential combination with SpaceX.”

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