Tesla's Robotaxi Event: What Wall Street Expects

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Tesla's (TSLA) highly anticipated robotaxi event is just days away, with the big reveal slated for Thursday, October 10. TSLA stock has been gaining ground in the weeks leading up to the event, rising 17% in the past month, and investors are hopeful the robotaxi event will create another catalyst to drive shares higher.

The event has been dubbed "We, Robot" and will give Wall Street its first look at the Tesla Cybercab prototype and the platform that owners and riders will use to book rides. In addition, Tesla is expected to release an update to its Full Self-Driving (FSD) technology, which will enable the robotaxis to function, as well as a timeline to the production of the Cybercab and the launch of the service.

However, some analysts on Wall Street think Tesla is simply playing catch-up at this point.

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"While Tesla is clearly focused on launching a robotaxi, Waymo and Cruise are already operating robotaxis in the U.S. today," says Bernstein analyst Toni Sacconaghi Jr. "The available data is clearly imperfect, but as of today Tesla appears to be lagging behind the leaders in the space."

Sacconaghi adds that Waymo, which is owned by Google's parent company Alphabet (GOOGL), has been working with regulators on its self-driving cars for over 10 years, while Tesla has not even begun the process.

Other Tesla news

On Wednesday, October 2, Tesla released its delivery numbers for the third quarter. Deliveries totaled 426,890, an increase of 4% from the prior quarter and 6% from the prior year.

Meanwhile, in a separate announcement on Thursday, October 3, Tesla said it recalled 27,000 Cybertrucks due to an issue with the rearview camera image not immediately activating when the vehicles were placed in reverse, according to the Associated Press.

Is TSLA stock a buy, sell or hold?

Wall Street is on the sidelines when it comes to the Magnificent 7 stock. According to S&P Global Market Intelligence, the average analyst target price for TSLA stock is $208.64, representing a discount of more than 15% to current levels. Additionally, the consensus recommendation is a Hold.

Financial services firm CFRA Research is one of those with a Hold rating on Tesla stock, along with a $240 price target.

"We think the stakes are high, and there is more risk to the downside than upside given the stock's recent run-up and the likelihood that the event could disappoint," says CFRA Research analyst Garrett Nelson. "We also note the stock price run-up and then 'sell the news' pattern of major Tesla events historically. Specifically, we are looking for more visibility regarding intermediate-term earnings growth."

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Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.