Summary
- Bank of America raises price target for Tesla stock by 32% following Donald Trump’s election
- Price target for Tesla shares adjusted from $265 to $350 per share
- Tesla could benefit from federal regulation of autonomous vehicles/full self-driving under Trump administration
- Analysts note potential benefits of close public relationship between Elon Musk and Donald Trump
- Trump administration may facilitate rollout of Tesla’s Robotaxi service and help maintain Tesla’s dominance in the EV sector
Article
Bank of America analysts have increased their price target for Tesla stock by 32% to $350 after Donald Trump was elected as the United States’ 47th president. The analysts maintained a “Buy” rating for the electric vehicle maker, citing potential benefits from Tesla CEO Elon Musk’s close ties to Trump. They believe that Tesla could benefit from a shift to federal regulation of autonomous vehicles, as well as Musk’s public relationship with the president.
In addition to the potential policy tailwinds from a Trump administration, Bank of America analysts believe that Tesla could benefit from a national standard for self-driving vehicle regulations, which could boost the rollout of Tesla’s Robotaxi service. This aligns with Wedbush analyst Dan Ives’ views that a Trump presidency could accelerate Tesla’s FSD goals. The analysts also noted that Trump’s inclination to ease environmental regulations could slow down the transition to electric vehicles for veteran automakers, giving Tesla the opportunity to strengthen its dominance in the EV sector.
The Biden administration has been notably pro-EV but has shown a tendency to ignore Tesla and Musk’s contributions to the electric vehicle sector. Musk’s businesses were subjected to investigations following comments made by President Biden in 2022 regarding Musk’s international relationships. Bank of America analysts believe that TSLA should be relatively indifferent to most policies discussed by the Biden administration but could benefit from Musk’s relationship with Trump and potential policy changes under the new administration.
Overall, Bank of America analysts are optimistic about Tesla’s growth trajectory and higher earnings multiple following the price target increase. They believe that factors such as a shift to federal regulation of autonomous vehicles, Musk’s relationship with Trump, and potential policy changes could support Tesla’s growth in the future. With Trump’s administration potentially easing environmental regulations and favoring self-driving vehicle standards, Tesla could further solidify its position in the EV market in the United States.
In conclusion, the price target increase from Bank of America reflects their positive outlook on Tesla’s potential under a Trump administration, highlighting the benefits of Musk’s ties to the president and potential policy changes. The analysts believe that Tesla could benefit from a national standard for self-driving vehicle regulations and ease in environmental regulations, which could strengthen Tesla’s dominance in the EV sector. Despite challenges from government investigations, Tesla remains well-positioned to capitalize on future growth opportunities in the electric vehicle market.
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