BNP Paribas Exane has initiated on Thursday coverage on Tesla, with an ‘Underperform’ rating on the company’s stock and a bearish price target.
In a client note obtained by PriceTarget, analyst James Picariello highlighted Tesla’s Robotaxi and Optimus humanoid projects, considered major factors in driving the company’s stock performance, despite not generating any revenue.
The bank set a $307 target on the Elon Musk-led company, which implies a downside of 29.4% based on Wednesday’s close at $435.15.
Tesla‘s stock price has doubled in the past twelve months and jumped 36.1% growth registered in the past three months.
As the market projects Tesla’s 2025 earnings to come about 55% from Robotaxi and Optimus, Picariello says it reveals the “extreme nature” of its current valuation.
The “two AI-led ventures generate zero sales today,” however, they generate 75% of the analyst’s total valuation of Tesla, at $1.02 trillion.
“Our dynamic valuation approach takes an optimistic view toward both the Robotaxi & Optimus businesses,” Picariello wrote.
According to the analyst, in BNP’s optimistic “bull-case” scenario, discounted cash flow models project that Tesla could reach a valuation of up to $2.7 trillion by 2040.
However, the analyst warns that “the stock’s unfavorable risk/reward is clear,” pointing out that the consensus earnings estimates for 2026 are “far too high” — making it more likely that it will decline rather than increase.
Picariello noted that Tesla‘s valuation is “extreme nature” compared to other Mag 7 companies (Apple, Microsoft, Amazon, Alphabet, Meta and Nvidia).
According to him, analysts are treating the brand’s projects with the “same level of risk and value-appropriation” as already established earnings of the other Mag 7 companies for next year.
Picariello estimates that Tesla will have an active fleet of about 525,000 Robotaxis by 2030 and have delivered 17 million cumulative Optimus, for $20,000 per unit, ten years later.
The analysts also estimates over 11 million active Full Self-Driving (FSD) subscriptions, in the next five years, which is “helping to drive our positive view of Tesla‘s automotive global market share.”
On August 18, BNP Paribas also started covering Chinese automakers XPeng and Li Auto.
The company set an ‘Underperform’ rating on Li Auto, with a $18 price target.
At the time, the automaker’s US-listed shares had closed at $24.05 in the prior market session, implying a 25.2% downside on the stock’s price.
The bank initiated coverage on XPeng with a $19 price target, implying a 3.9% decline from the prior closing price of $19.78. BNP set a ‘Neutral’ rating on the stock.
As of press time, XPeng shares are trading 2.5% lower at $21.09, while Li Auto is dropping 1% at $22.55. Tesla remains flat at around $436.
