Goldman Sachs Keeps Neutral on Tesla, $360 Price Target

Goldman Sachs analyst Mark Delaney reiterated a Neutral rating and $360 price target on Tesla (NASDAQ: TSLA)

“The 3Q report showed good progress in several areas, including: 1) progress in autonomy (e.g.

FSD is now on >75% of new vehicle deliveries in North America, and unsupervised robotaxi miles are growing double digits week on week and reached 3.1 mn cumulatively as of 10/18 and came in ahead of our expectation); 2) a strong backlog in both Auto and Energy; and 3) gross margins were better than we expected in all three segments.

However, there were some mixed to softer datapoints, with opex higher than we had estimated, Energy segment revenue lower than our estimate, and the company is still iterating on Optimus.

Overall we think the report suggests the company will see improving EPS in 2027/2028, and our EPS estimates are roughly unchanged on average.

Specifically, Tesla reported 3Q revenue/gross margins/EBIT/non-GAAP EPS of $28.0 bn/19.6%/$718 mn/$0.48 compared to company-compiled consensus at $28.3 bn/17.9%/$721 mn/$0.45 and GS at $29.3 bn/18.5%/$1,043 mn/$0.44.

We maintain our Neutral rating on the stock. We continue to believe that Tesla can benefit over time from its opportunities in several large markets, including autonomy, robotics, EVs and energy.

However, over the near to medium term, we expect profitability and FCF to remain somewhat pressured from higher opex and capex.

In addition, while we expect improved growth from these areas to support an attractive long-term EPS CAGR, we also believe the magnitude and pace of that EPS improvement will be somewhat limited by competition (e.g.

Tesla is facing several competitors in AVs, EVs, Energy and robotics).

Finally, we see valuation as full.”

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