Investing.com -- Analysts at BNP Paribas initiated Tesla shares with a bearish Underperform rating and $307 per share price target in a note to clients on Thursday, suggesting a potential 29% downside from current levels.
The bank told investors that “Tesla’s two AI-led ventures generate zero sales today, yet inform ~75% of our ~$1.02T price target,” with its valuation approach said to take an “optimistic view toward both the Tobotaxi & Optimus businesses.”
“Our ‘bull-case’ DFC models out to 2040 supporting max TSLA valuation of $2.7T,” stated the bank. “We then discount these DCFs through a series of respective milestone probabilities to arrive at our base case ($1.02T value,” which is still a robust interpretation of TSLA’s future.”
As a result, the analysts believe the stock’s unfavorable risk/reward is clear, with 2026 consensus estimates said to be “far too high.”
BNP Paribas added that even its base case assumes TSLA achieves quite a lot, including an “active 30E Robotaxi fleet of ~525k,” 17 million cumulative Optimus deliveries by 2040 and 11 million active FSD subscriptions by the end of 2030.
“While our ‘s2E & beyond runs highly constructive, we see major downside to ‘26E Street,” the analysts remarked.
“Our ‘26E FCF of ~$225M is a full $4B lower than consensus, which we do not believe takes into consideration Tesla’ (well-known?) margin headwinds… and D&A unlocked from capitalized AI & software costs, as Robotaxi & Optimus enter phase-one commercializations, applying additional gross profit pressure.”
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BNP Paribas slaps Underperform rating on Tesla, sees 29% downside
Published 3 weeks ago
Oct 16, 2025 at 12:51 PM
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