Tesla’s Stock Defies Delivery Slump as Wall Street Bets on Future Tech

Tesla US88160R1014

Tesla finds itself at a curious crossroads. Despite reporting disappointing vehicle delivery figures and ceding its crown as the world's top electric vehicle (EV) maker to China's BYD, the company's shares moved higher at the start of the week. This paradoxical investor response highlights a fundamental divide among market experts: should the focus be on the company's contracting core automotive operations, or the long-term wager on its artificial intelligence and autonomous driving ambitions?

Providing a key catalyst for the recent share price movement, analysts at Goldman Sachs raised their price target for Tesla from $400 to $420. This upgrade injected optimism into the market on Monday, with the stock posting a notable gain and closing the trading session at $454.88. The move by the investment bank's research team signals a sustained confidence in the automaker's long-term trajectory, even as it navigates immediate operational headwinds.

The timing of this positive reassessment is particularly striking. It comes just days after Tesla disclosed that its fourth-quarter 2025 deliveries of approximately 418,000 vehicles fell short of expectations. This figure represents a 16% decline compared to the same period the previous year.

Divergent Views Define Analyst Sentiment

The upgrade from Goldman Sachs underscores the sharp disagreement permeating Wall Street research desks. The investment community remains deeply split on Tesla's outlook:

• The Bullish Camp: Firms such as Baird continue to label Tesla a core investment for 2026, pointing to its robust free cash flow and opportunities stemming from AI development. Analysts at Wedbush similarly express significant optimism, pinning substantial future value on the success of full self-driving technology.
• The Cautious Contrarians: In contrast, institutions including HSBC, JPMorgan, and UBS maintain their "Sell" ratings. These skeptics criticize the growing disconnect between Tesla's elevated market valuation and the deteriorating profit forecasts for its traditional car manufacturing business.

BYD Overtakes, While Energy Storage Shines

Competitive pressures have intensified markedly. During 2025, Tesla relinquished its position as the global leader in pure electric vehicle sales to its Chinese rival, BYD. BYD reported sales of 2.26 million EVs, surpassing Tesla's total of 1.64 million. Tesla's performance was hampered by the expiration of tax credits in key markets and notably weak demand across Europe.

A significant bright spot, however, emerged from Tesla's energy division. This segment is experiencing dynamic growth, with deployments of storage systems reaching 14.2 gigawatt-hours in the last quarter. Benefiting from strong demand from utility providers and data centers, the energy business has now evolved into the company's most profitable unit.

Upcoming Catalysts: Earnings and Key Launches

The coming weeks are poised to be critical for determining the stock's next directional move. All eyes will be on Tesla's detailed fourth-quarter results, scheduled for release on January 28, 2026. Analysts are anticipating a steep year-over-year earnings decline of nearly 40%.

Consequently, investor attention is likely to shift away from the past quarter's automotive struggles and toward the company's forthcoming milestones. The primary focus will be on two future projects: the planned start of production for the "Cybercab" in April 2026, and the potential regulatory approval for its Full Self-Driving (FSD) software in the European market.