Tesla Inc. TSLA shares climbed more than 8% Wednesday amid optimistic forecasts from prominent investor Gary Black, who cited multiple growth catalysts for the electric vehicle maker in 2025.
What Happened: Black, managing partner of The Future Fund LLC, highlighted Tesla’s upcoming $30,000-$35,000 vehicle as a key driver for expanding the company’s total addressable market in the compact segment. The forecast comes as Tesla dominated U.S. electric vehicle sales in 2024, with its Model Y SUV capturing 28.6% market share.
“Tesla catalysts are the strongest collection I’ve seen in years,” Black wrote on X, pointing to potential regulatory tailwinds under the President-elect Donald Trump administration for autonomous driving approval and the Delaware Supreme Court’s recent decision on CEO Elon Musk‘s compensation package.
The Future Fund projects Tesla’s earnings per share to reach $3.70 in fiscal 2025, surpassing the consensus estimate of $3.25. The firm maintains its $380 price target while noting potential upside if Federal Reserve interest rate cuts materialize.
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Why It Matters: Black dismissed speculation about X acquiring TikTok’s U.S. operations but acknowledged risks to Tesla’s outlook, including possible changes to the $7,500 federal EV tax credit. When questioned about focusing on Tesla’s automotive business, Black defended his stance, noting it generates 85% of the company’s profits.
The bullish outlook comes as the broader EV market shows signs of strength. Industry researcher Cox Automotive expects electric vehicles to comprise 10% of total U.S. auto sales in 2025, up from 8.1% in 2024, despite potential policy uncertainties under the incoming Trump administration.
Tesla’s stock surge coincided with RBC raising its price target to $440 from $313, contributing to Wednesday’s broader market rally that saw major indices climb more than 1.5% on cooling inflation data.
Price Action: Tesla’s stock closed at $428.22 on Wednesday, marking an 8.04% gain. In after-hours trading, the stock slightly dipped by 0.61%. Over the past year, Tesla shares have surged an impressive 94.73%, according to data from Benzinga Pro.
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