Truist Securities has reduced its price target on Tesla (NASDAQ:TSLA) to $438.00 from $439.00 while retaining a Hold rating on the electric vehicle maker's shares. Tesla was trading around $431.46 at the time noted in the report, which also referenced InvestingPro Fair Value indicators suggesting the stock may be overvalued despite a 34.33% price gain over the past six months.
The analyst action follows Tesla's fourth-quarter earnings release, which delivered modest beats in revenue and gross profit margin but did not include forward guidance for the first quarter. The company reported diluted earnings per share of $1.45 for the trailing twelve months, while consensus forecasts cited in the note put fiscal 2025 EPS at $1.70.
In its review of Tesla's evolving operations, Truist highlighted three material strategy changes the company has implemented. First, Tesla is discontinuing production of its Model S and Model X platforms. Second, the automaker is allocating capital to add six new production lines and associated training hardware. Third, Tesla has introduced artificial intelligence-related operational targets for calendar year 2026.
Those strategic adjustments accompany a sharply higher capital expenditure outlook. Truist expects Tesla's capex to increase from $8.5 billion to roughly $20 billion this year, and it anticipates continued additional spending beyond that level. The firm described these alterations as fundamentally positive, yet said that its updated discounted cash flow analysis produced only a very small change to its prior target. As a result, Truist left its rating at neutral.
The company's reported fourth-quarter results for 2025 exceeded the market's expectations. Tesla posted an EPS of $0.50, above the $0.45 forecast - an 11.11% surprise - and generated revenue of $24.9 billion versus the projected $24.78 billion. Those outcomes supported a modest uptick in Tesla shares during aftermarket trading following the announcement.
Truist's note underscores a juxtaposition: visible near-term financial outperformance on a quarterly basis alongside substantial shifts in product lineup, factory deployment and spending plans that will influence capital requirements and operational execution in the coming years. The firm’s restrained modification to its valuation and the maintained Hold rating reflect that, in its view, the positive elements and the higher investment profile largely offset one another in valuing the business today.
Readouts and metrics highlighted in the analysis
- Treasured price target adjusted to $438.00 from $439.00 with a Hold rating.
- Tesla trading near $431.46 and noted as potentially overvalued by InvestingPro Fair Value measures.
- Reported trailing twelve-month diluted EPS of $1.45 and analyst consensus of $1.70 for fiscal 2025.
- Fourth-quarter 2025 reported EPS of $0.50 versus $0.45 expected; revenue $24.9 billion versus $24.78 billion expected.
- Planned capex jump from $8.5 billion to about $20 billion this year, with further spending expected.