Tesla (NASDAQ:TSLA) stock is resurgent. As most analysts point out, it’s an incredibly expensive electric vehicle (EV) stock. So the surge might have surprised some investors.
Shares in Tesla have gained about 37% over the past month. One reason for this is better-than-expected EV deliveries — which were still down 4.8% over 12 months — and this led other New Energy Vehicle (NEV) companies, including Rivian (NASDAQ:RIVN), higher.
But what do analysts forecasts say about Tesla and Rivian? Let’s take a closer look.
Wall Street’s take
According to analysts, Tesla’s trading at a sizeable premium to where it should be. The target price is $182.82, inferring that the stock is 24.61% overvalued.
This is just taking the 34 analysts that have covered the stock in the last three months.
To make things worse, the most recent coverage is from the influential JP Morgan and its analyst puts Tesla stock at just $115.
This should suggest that Tesla stock is overvalued by 52.88%. The lowest share price target is just $22.86 and the highest is $310.
So what about Rivian? Well, like most stocks, it tends to trade at a discount to its share price target.
Despite Rivian surging more than 30% as well in the last 30 days, it’s currently 12.94% discounted, according to the 22 analysts covering it.
However, the latest analyst to cover the stock issued a Buy rating but with a share price target of $13. That’s a 13.22% discount to the current share price.
The lowest share price target is just $8, and the highest is $30.
A deeper dive
Tesla currently trades around 84 times earnings from the last 12 months, and 91 times expected earnings for 2024. This makes it extraordinarily expensive.
However, Elon Musk has been asking investors to treat Tesla like a technology company, which utilises AI and robotics, and not an EV firm.
Tesla is set to unveil its firstly truly autonomous vehicle — the robotaxi — on 8 August. It could be huge for the company if it’s really ready to deploy, with autonomous taxis promising to be a very high margin business.
Musk’s company is also making strides robotics, with the Optimus robot potentially going on sale in the second half of 2025. Musk thinks these robots will be huge business, suggesting it could take the stock to $25trn.
The company is also making strides in robotics, with the Optimus robot potentially going on sale in the second half of 2025. Musk thinks these robots will be huge business, suggesting it could take the stock to $25trn.
Rivian, on the other hand, is a pretender to Tesla’s crown in the EV space. But it’s a long, long way behind. Rivian delivered around 13,790 vehicles in Q2, while Tesla delivered 443,956 vehicles.
It’s also loss-making and remains some way off. Projections suggest that Rivian’s large cash pile could disappear in just two years. This could be accelerated by the release of cheaper vehicles — the R2 and R3 — which typically have shallower margins.
