Tesla Remains Piper Sandler’s Top ‘Buy-and-Hold’ Idea, But Trump’s EV Threat Dents Stock And Retail Confidence
The brokerage notes that once Tesla’s current launch pipeline is fulfilled, the focus will likely shift from new car releases to popularizing full self-driving software.
FollowShares of Tesla Inc. dropped nearly 3% on Tuesday morning, the first trading day after Donald Trump’s second inauguration as U.S. President.
During his inauguration speech on Monday, Trump vowed to dismantle Environmental Protection Agency (EPA) rules requiring automakers to sell all-battery electric vehicles (EVs) to avoid severe emissions-related fines.
“We will end the Green New Deal, and we will revoke the electric-vehicle mandate, saving our auto industry and keeping my sacred pledge to our great American auto workers,” Trump declared.
However, investors continue to view his presidency as a potential boost for Tesla, fueled mainly by Tesla CEO Elon Musk’s alignment with the president.
However, on Stocktwits, where Tesla boasts nearly a million followers, sentiment dipped into ‘bearish’ territory amidst a surge in message volume.
The platform also saw significant backlash after Musk, at Trump’s inauguration rally, appeared to make a one-armed gesture many interpreted as resembling a Nazi salute.
However, Piper Sandler on Tuesday raised its price target for Tesla to $500 from $315 — representing a 20% upside from current levels — and maintained an ‘Overweight’ rating on the stock, according to TheFly.
The firm sees growing investor recognition of Tesla’s potential in “real-world” artificial intelligence, which makes portfolio managers more optimistic about the stock’s upside.
Piper also acknowledged that near-term uncertainty around Tesla’s outlook could weigh on sentiment.
The brokerage noted that once Tesla’s current launch pipeline is fulfilled, the focus will likely shift from new car releases to popularizing full self-driving software.
Piper said it has adjusted its model to account for a contribution from full self-driving licensing and estimates Tesla’s existing businesses are valued just below $300 per share, including full self-driving.
The firm also pointed out the growing significance of emerging technologies, such as Optimus robots and neural-net-training-as-a-service, in shaping Tesla’s future.
Although the first half of 2025 may present challenges, Piper Sandler continues to view Tesla as its top “buy-and-hold” idea.
Tesla’s stock is up over 6% so far this year.
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