New Street named Tesla its ‘Top Pick’ stock on Thursday, just two days after raising the price target on the Elon Musk-led company by 15% to $600.
One of the most bullish firms on Tesla, alongside Wedbush, New Street said on Tuesday that the company’s strategy is being validated as rivals unveil their own self-driving projects — albeit a decade later.
“The signal from Vegas is loud and clear,” analyst Pierre Ferragu wrote then. “The industry isn’t catching up to Tesla; it is actively validating Tesla’s strategy… just with a 12-year lag.”
On Monday, Nvidia unveiled its open-source self-driving software platform, which it plans to deploy in robotaxi fleets starting next year.
The announcement led Tesla shares to drop over 4% on Tuesday.
The company’s stock has dropped over 13% since reaching an all-time high of $498.83 on December 22.
New Street’s reiterated price target of $600 sees an upside potential of 39% on the share value, based on Wednesday’s close at $431.41.
Lower Costs
In a new research note published this Thursday, analysts Pierre Ferragu and Ben Harwood said that Tesla is the company best positioned to lead progress in robotaxis.
“The robotaxi market is at an inflection point, with Waymo, Tesla, and others expanding commercial operations this year,” they wrote.
According to Ferragu and Harwood, the company “benefits from three structural advantages versus peers,” which include “the lowest unit cost” and “a flexible supply base that avoids diminishing capital returns.”
Last year, as Tesla was preparing to launch its Robotaxi service in Austin, Musk was questioned on how the company expected to compare against Waymo‘s offering, pricing, geofencing, and regulatory flexibility.
He joked that “the issue with Waymo’s cars is it costs Way-mo [way more] money.”
“The car is very expensive, made in low volume. Teslas are probably cost 25% or 20% of what a Waymo costs and made in very high volume,” the chief executive added.
According to Musk, the Cybercab model, used for the fully autonomous ride-hailing service, will “cost roughly $25,000” to produce.
With its recently patented ‘Unboxed’ manufacturing process, the company aims to produce one Cybercab every 10 seconds, Musk reaffirmed in November, as he revealed that production for the model will begin in April.
By then, he was also confident that “the rate at which we receive regulatory approval will roughly match the rate of Cybercab production.”
Robotaxi Fleet
The analysts also highlighted Tesla‘s “massive fleet,” which contributes to accelerating “learning and product improvement.”
According to New Street, these advantages lead Tesla to “be able to expand faster and price more aggressively than competitors, capturing a leading share of the opportunity.”
Tesla‘s ride-hailing service was launched with a fleet of Model Ys, powered by a Robotaxi-specific version of the Full-Self Driving (FSD) software.
The vehicles required a safety operator to be inside the car — either in the driver’s seat or the passenger seat, depending on road regulations and operating conditions.
Since then, the company has worked towards removing these operators, with Musk stating that the company was prioritizing safety.
“The safety driver is just there for the first few months to be extra safe. Should be no safety driver by end of year,” he wrote no X.
Last month, Tesla‘s stock jumped as the company publicly tested the first fully empty vehicles in Austin.
New Street sees “several catalysts playing out in 2026 that should serve as confirmation of this thesis,” expecting a positive reaction from investors.
The firm has reiterated its Buy rating on Tesla.
As of press time, Tesla shares were trading 0.8% higher at $435.
