What Happened?
Shares of electric vehicle pioneer Tesla (NASDAQ: TSLA) fell 3.8% in the afternoon session after the company reported record third-quarter deliveries that beat expectations, but investors grew concerned about future demand.
Tesla delivered a record 497,099 vehicles, which was well above Wall Street's forecast. However, the strong sales were largely attributed to a rush from U.S. consumers to buy an electric vehicle before a key federal tax credit expired at the end of September. This created a belief that demand was pulled forward, potentially leading to a weaker fourth quarter and 2026.
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What Is The Market Telling Us
Tesla’s shares are extremely volatile and have had 46 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 6 days ago when the stock gained 3.1% on the news that Wall Street analysts raised their price targets on the company, citing optimism over its artificial intelligence-driven initiatives, robotaxi rollout, and humanoid robotics business.
The stock's gain marked a comeback after a fall in the previous session that was linked to data showing a sales decline in Europe. Analysts at Wedbush and Deutsche Bank showed renewed confidence. Wedbush increased its price target to a Street-high of $600 from $500, stating that Tesla was advancing its path toward an "AI Revolution." Deutsche Bank also lifted its price target to $435 from $345 ahead of the company's third-quarter delivery report. Both firms kept their "Buy" ratings. The positive sentiment was further supported by more recent sales data, which showed a strong rebound. For instance, new Model Y registrations in Sweden saw a significant increase compared to the previous month, and the company posted its strongest European registration week of the third quarter.
Tesla is up 16.7% since the beginning of the year, and at $442.67 per share, it is trading close to its 52-week high of $479.86 from December 2024. Investors who bought $1,000 worth of Tesla’s shares 5 years ago would now be looking at an investment worth $3,199.
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