Tesla, Inc. TSLA Shares extended their gains for a third straight session on Thursday following the release of the electric vehicle maker’s quarterly results. Gary Black From Future fund shared his insights on the stock performance and the company’s future trajectory.
What happened: According to Black, the 17.6% surge in Tesla shares after earnings is attributed to the optimistic product outlook communicated in the earnings report and confirmed by the CEO Elon Musk during the earnings call.
“There is no other way to interpret this language other than that TSLA is preparing new, more affordable models using both next-generation and existing production platforms for first production by 2025/1H,” the analyst said. This, according to the fund manager, is optimistic as it indicates that the company will expand its total addressable market with more affordable compact vehicles to the mass segment by mid-2025.
See also: Everything you need to know about Tesla stock
However, Black noted that Musk’s emphasis on Tesla’s commitment to autonomy has not yet resonated with institutional investors. The lack of discussion about the robotaxis opportunity following the earnings release suggests investors remain cautious.
Black pointed out that the minimal impact on Uber and Lyft shares indicates that investors may not perceive Tesla’s unsupervised ride-hailing as a significant threat to these companies.
But he didn’t rule out a narrative shift on Aug. 8, when Tesla is expected to unveil robotaxis. “TSLA’s continued focus on more affordable non-robotaxi vehicles seems to be the biggest thing so far,” she said.
Because matter: Despite the stock rally, skepticism remains among some analysts. GLJ Research‘S Gordon Johnson interpreted Tesla’s product roadmap language as indicative of a potential abandonment of the sub-$30,000 car, with a shift toward cost-cutting strategies for existing models.
Concerns persist about Tesla’s automotive core gross margin and significant depletion of free cash flow, prompting cautious outlooks from analysts such as Wedbush‘S Daniel Ives.
Tesla closed Thursday’s session up 4.97% at $170.18, according to Benzinga Pro data.
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