Goldman Sachs reiterated on Tuesday its Neutral rating and $400 price target on Tesla after CEO Elon Musk confirmed that the company had begun testing robotaxi rides in Austin without a safety operator inside the vehicle.
The milestone demonstrates that “Tesla is making progress with its autonomous technology,” analyst Mark Delaney wrote in a research note obtained by PriceTarget.
Musk first said in September that the company aimed to remove safety operators in Austin — where they had been seated in the passenger seat — by year-end.
The chief executive reiterated the target several times in subsequent months, referring to a removal in “at least large parts of Austin by the end of this year.”
“Recall Tesla had previously commented that it planned to launch its ridehail service with robotaxi technology in 8-10 metros by the end of the year (including upcoming launches in Las Vegas, Phoenix, Dallas, Houston, and Miami) and was targeting to have the safety observer out by year-end in Austin,” Delaney wrote.
The firm maintains a cautious stance on the stock. The $400 price target implies a downside of 15.8% based on Monday’s closing price.
Goldman Sachs said the key question now is execution speed and unit economics.
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla‘s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability,” Delaney noted.
The firm remains cautious as it expects competitors to also keep improving.
“We continue to expect autonomy (both FSD and robotaxis) to be key drivers of Tesla‘s growth, but we expect competition to gate the level of profitability improvement.”
Wedbush took a more bullish stance earlier this week.
Ives reiterated his $600 price target Monday, writing that “heading into 2026, this marks a monster year ahead for Tesla and Musk as the autonomous and robotics chapter begins.”
In December 2024, responding to an X post praising the company’s software, Musk wrote: “The brutal reality of the situation will hit like a tsunami towards the end of next year.”
The last time Musk invoked the word “tsunami” was in 2012, when shares traded at approximately $5 on a split-adjusted basis.
“I think there is a tsunami of hurt coming for those holding a short position, it’s going to be very unpleasant. I advise people to exit, while there is time,” he warned at the time during a Fox Business interview.
Tesla shares rose 3.56% to close at $475 Monday following the robotaxi news, finishing $13 below the all-time high reached a year ago.
