TD Cowen analyst Itay Michaeli reiterated a Buy rating and $460 price target on Tesla after hosting autonomous vehicle expert Alex Roy on the firm’s recent ‘Internet Bus Tour.’
Roy discussed key debates around the emergence and scaling of autonomous vehicle rideshare and the potential for licensing to automotive OEMs, as can be read in the Wall Street research note archive PriceTarget.
Michaeli’s note keeps the $460 target he set on July 23 — when he cut it from $490, alongside six other Wall Street firms’ decreases, following Tesla’s second-quarter earnings miss on profitability.
According to Roy, Waymo and Tesla are the best positioned firms to scale in the US AV market, but described the two companies as approaching the problem from opposite ends.
Waymo’s Hardware Appeal
The expert considered Waymo to be in “an extraordinarily strong position” as the current leader “in terms of rollout scale as well as overall safety,” although it “still faces some risk given the bulky implementation of their AV hardware.”
Waymo recently suspended robotaxi service on freeways in Los Angeles, Miami, Phoenix and San Francisco to improve how its vehicles behave in construction zones.
Last month, images surfaced of a dashboard reading from a Waymo Jaguar I-Pace, which showed the robotaxi using more than six times the energy per mile of Tesla‘s purpose-built Cybercab.
The photograph posted on X showed an energy-consumption reading of 104.4 kWh/100 miles.
While the Jaguar‘s I-Pace model carries an EPA-rated consumption of about 44 kWh/100 miles, the consumption is estimated to go up by at least 10 kWh when retrofitted with the autonomy stack needed to perform the robotaxi service.
Waymo‘s key challenge, in his view, is “shrinking the size of the LiDAR & camera apparatus to a level that would appeal to car consumers, so that Waymo can license the technology to major OEM brands.”
Tesla’s Safety Challenges
Tesla‘s efforts, by contrast, are focused on improving the safety level of its software stack.
Roy argued that “Waymo & Tesla will likely intersect at some point as younger generation of consumers will likely view Tesla‘s safety level as ‘good enough,’ even if it’s not as safe as Waymo.”
Comparing the two remains hard, with Roy acknowledging that “it’s difficult to measure Tesla‘s safety levels given they don’t disclose apples-to-apples data relative to Waymo.”
AV rideshare customers are not likely to closely scrutinize the precise safety measures of the leading autonomous services, he added.
Roy reiterated that he expects a major US player to achieve significant national scale in the next five years or so.
Tesla Robotaxi Fleet
Tesla launched its first paid robotaxi rides in Austin in June 2025 using modified Model Y vehicles.
The service now spans seven metropolitan markets — the Bay Area, Austin, Dallas, Houston, Miami, Orlando and Tampa — across three states, after expanding to Orlando and Tampa on July 21, one day before the company’s second-quarter earnings report.
Tesla disclosed 380,000 unsupervised miles and nearly 2.5 million total paid miles through the second quarter.
The unsupervised fleet remains modest, with Texas filings showing 175 vehicles registered for ride-hailing as of mid-July.
The Bay Area fleet is at “well over 500 vehicles” according to Musk. However, it still requires a human safety driver under California regulations.
Tesla has targeted paid Cybercab rides before the end of the year, with Austin expected as the first market.
Waymo operates across more than ten US cities, delivering over 500,000 paid rides per week and aiming to achieve 1 million by the end of 2026.
The company has registered entities outside of the US — including both in Asia and in Europe.
The Alphabet subsidiary began offering rides in its new purpose-built Ojai robotaxi in San Francisco, Phoenix and Los Angeles in late May.
TD Cowen’s Tesla Coverage
The reiterated price target of $460 implies an upside potential of 35.3% on the stock, based on Thursday’s closing price of $339.96.
As of press time, Tesla‘s shares were trading 3% higher at $350.53 on Friday’s market session, shortly after a report by The Information said the company is planning to unveil the much anticipated Roadster by the end of August.
TD Cowen’s price target on Tesla has moved in both directions over the past twelve months.
Michaeli raised it to $519 in January 2026, then lowered it to $490 in April as part of a broader autos sector first-quarter preview.
He reiterated that $490 figure through several subsequent notes in April, June and early July.
The July 23 cut to $460 followed second-quarter results that beat revenue estimates but missed on profitability by a wide margin.
Tesla committed to more than $25 billion of capital spending this year. Seven firms cut targets the same day.
Michaeli has been among the more vocal bulls on Tesla‘s autonomy timeline.
After testing FSD Version 14 and touring Giga Texas in November 2025, he wrote that autonomous vehicle scaling had become “a question of when, not if” and projected the Cybercab could achieve an operating cost of approximately 30 cents per mile.
Before initiating coverage, the firm had no formal position on the stock.
Since the $388 initiation in March 2025, the target rose to $509 in October 2025, held there through November, climbed to $519 in January 2026, dropped to $490 in April, and fell to $460 in July.
Roy Identifies Emerging AV Players
Roy said the US market will ultimately adopt a “winner take most” dynamic with Waymo and Tesla the most likely to succeed, but noted that several other players could emerge given the early stage of the AV rideshare market.
Amazon-owned Zoox could reach adequate safety levels to scale its rideshare service, Roy said.
NHTSA granted Zoox a temporary exemption on July 30 to commercially deploy its purpose-built robotaxis — the first time the agency has allowed a vehicle without traditional human controls to charge passengers for rides.
Roy also cited the Lucid and Nuro partnership with Uber as an emerging contender, as well as British AI driving company Wayve and Intel-owned Mobileye as potential players that could eventually achieve major scale in AV hardware.
Under the Lucid-Nuro programme, Uber has committed to purchasing at least 35,000 Gravity SUVs equipped with Nuro’s Level 4 autonomy system, up from the original 20,000 agreed in July 2025.
Uber has invested $500 million in Lucid.
Nuro operates approximately 100 Gravity SUVs for the programme and received California DMV approval to test driverless Gravity robotaxis on public roads in May.
TD Cowen also covers Lucid, which Michaeli rates Hold. The analyst has lowered the firm’s target twice this year — to $10 from $19 in April and to $7 from $10 in May.
