Tech bull Dan Ives predicts Tesla's robotaxi launch will catapult the company to a $2 trillion market cap, almost double its current value
Tesla's robotaxi rollout represents the start of CEO Elon Musk's long-held belief that the future of the company will be in autonomous vehicles. Wedbush analyst Dan Ives said the start of the program could almost double Tesla's market cap by the end of 2026.
Tesla is on the cusp of a new era in the company's history, according to the bullish tech investor Dan Ives.
As Tesla prepares to launch the early stages of its robotaxi offering in Austin, Texas this weekend, the carmaker will make good on its long-held ambitions to enter the ride-hailing business.
Ives, whose Wedbush Securities is often bullish on the tech sector, welcomed the robotaxi launch. 'We view this autonomous chapter as one of the most important for Musk and Tesla in its history as a company,' he wrote in an analyst note released Friday.
The idea that Tesla's self-driving technology would enable it to have a fleet of robotaxis is central to the investment thesis for the company. Its chief executive, Elon Musk, has long outlined his vision of millions of self-driving Teslas shuttling around paying customers as the next phase of the company's future. Musk has said the company's aim is to allow Tesla owners to make their cars part of its robotaxi fleet when they aren't using their cars.
'So, kind of like Airbnb where you can sort of add or subtract your house or your guest room,' Musk said in January.
The best-case scenario of the robotaxi rollout could essentially double Tesla's market cap by the end of 2026, Ives said. He predicted that Tesla's market cap would reach $2 trillion through next year. Tesla's stock has had a poor year in 2025 so far, declining 15.9% year-to-date. The company reported disappointing sales results earlier this year. Tesla shareholders also found themselves having to contend with forces far outside their control such as a souring relationship between the U.S. and China, its two biggest markets, and Musk's involvement in politics and the Trump administration, which attracted significant scrutiny.
Tesla did not respond to a request for comment.
After the test in Austin, which will start in a geofenced location with about 25 cars, future expansions will be made easier by a favorable regulatory environment.
'We fully expect under a [President Donald] Trump White House these key initiatives will now get fast tracked as the federal regulatory spiderweb that Musk & Co. have encountered over the past few years around autonomous clears significantly,' Ives said.
The excitement of Tesla's most bullish investors, however, put off some others. Earlier this month, investment firm Baird downgraded Tesla's stock from 'buy' to 'neutral' because it saw the rate at which the robotaxi program would expand as 'a bit too optimistic.' Baird also highlighted the public tiff between Musk and Trump as raising uncertainty surrounding Tesla's future. Argus Research cited the falling-out as the main reason for its own downgrade, which also came this month. Analysts at Argus feared Tesla's stock was trading on 'non-fundamental events,' meaning investors were buying and selling the stock for reasons that weren't related to its financials.
'Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with the expiration of EV credits, could further weaken demand for new Teslas,' wrote Argus analyst Bill Selesky.
Ives, however, saw past the spat. 'The BFF/frenemy situation with Musk and Trump has created a soap opera on this front but ultimately Trump wants the US to stay ahead of China in this AI arms race and autonomous is a key factor in who wins AI with Tesla playing a major role on robotaxis,' he said. 'We expect over the coming months an easing of the federal framework for autonomous with more power going to the federal regulators with states having less authority on the autonomous rules.'
Tesla's robotaxi would not be the first autonomous vehicle approved for use in the U.S. Alphabet-owned Waymo is currently available in San Francisco, Phoenix, Los Angeles, and Austin. This week, Waymo also announced it had applied for a permit to conduct a test for its autonomous vehicles in New York. Tech giant Amazon also has an autonomous-vehicle initiative called Zoox that is slated to launch in Las Vegas later this year.
This story was originally featured on Fortune.com
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Miami Herald
2 hours ago
- Miami Herald
Tesla signs deal for $556 million grid-scale battery storage station in China
Tesla Friday signed a $556.8 million agreement to build a grid-scale battery storage station in China. The deal is with China Kangfu International Leasing Co., as well as the Shanghai local government. It's the first Tesla large-scale battery storage facility in China. In a statement on Chinese social media site Weibo, Tesla said, 'Tesla's first grid-side energy storage power station project in mainland China has been officially grid-side energy storage power station is a 'smart regulator' for urban electricity, which can flexibly adjust grid resources.' Tesla said that, when complete, this project is expected to become the largest grid-side energy storage project in China. Utility-scale battery energy storage assists energy grid management by keeping supply and demand in balance. More is being built worldwide. Tesla competed against two Chinese companies that offer similar products. CATL and automaker BYD have significant global market share in these battery storage products. China plans to add nearly 5 gigawatts of electricity supply powered by batteries by the end of 2025, which would bring the total capacity to 40 gigawatts. Copyright 2025 UPI News Corporation. All Rights Reserved.
Yahoo
3 hours ago
- Yahoo
TSLA: Tesla Robotaxi Push Could Be a $1 Trillion Game-Changer
June 20 - Tesla (NASDAQ:TSLA) is set to launch its robotaxi operations in Austin this Sunday, with about 20 Model Y vehicles operating in a designated area, Wedbush mentioned in a Friday note. The firm called the move a key milestone that could define Tesla's next phase, estimating the autonomous unit alone could eventually add $1 trillion to the electric carmaker's valuation. Wedbush maintained its Outperform rating and $500 price target, citing Tesla's global reach and progress in artificial intelligence and driverless technology. The firm expects Tesla to scale the service to roughly 25 U.S. cities within a year and sees potential policy support ahead. Analysts said a Trump presidency could accelerate regulatory clearance for full self-driving systems. Tesla plans to begin production of its dedicated robotaxi model, the Cybercab, sometime next year, the note added. Wedbush believes Tesla's roadmap on autonomy and robotics will unfold gradually, saying, Rome wasn't built in a day. In a bull case, the firm sees Tesla reaching a $2 trillion market cap by the end of 2026. This article first appeared on GuruFocus.
Yahoo
4 hours ago
- Yahoo
Does BYD or Tesla stock offer the best value?
Tesla (NASDAQ:TSLA) and BYD (OTC:BYDD.F) are the two titans of the global electric vehicle (EV) market, but their investment cases diverge sharply when you dig into the numbers and outlook. Here's how they stack up for investors looking ahead. Tesla's forward price-to-earnings (P/E) ratios remain stratospheric by any standard. The company is expected to trade at 168.8 times earnings in 2025, falling to 111.4 times in 2026 and 85.7 times in 2027. Even by its own five-year history, these multiples are elevated, and they are more than 10 times the consumer discretionary sector median. BYD, by contrast, looks far more modest. Its forward P/E is 18.4 times for 2025 and 14.2 times for 2026. That's just a fraction of Tesla's and much closer to sector norms. This huge valuation gap reflects the market's belief in Tesla's future growth, but also means any disappointment could hit the shares hard. Tesla's price-to-sales ratio for 2025 is a lofty 10.4 times, while BYD's is just 0.65 times. In other words, investors are paying a huge premium for each dollar of Tesla's sales, while BYD trades closer to traditional automaker multiples. BYD's lower multiple reflects its mass-market positioning and focus on affordability, while Tesla's premium signals expectations for high-margin growth and disruptive new business lines. Tesla boasts a market cap over $1trn, with $37bn in cash and $13bn in debt. This gives it a strong net cash position and plenty of firepower for R&D and expansion. BYD, with a market cap around $147bn, holds $21bn in cash and $5.7bn in debt. Still solid, but on a smaller scale. Tesla's financial muscle gives it flexibility, but BYD's balance sheet is also robust and supports its rapid global expansion. The real battleground is not just EVs, but autonomous driving and robotics. Tesla's valuation is highly detached from automotive peers because investors are betting it will dominate self-driving technology and unlock new business models like robotaxis and AI-powered logistics. Its Dojo supercomputer and Full Self-Driving (FSD) efforts are central to this thesis, though regulatory hurdles remain. BYD is not standing still. Its latest models integrate advanced driver-assist systems, LiDAR, and rapid-charging battery tech. This has already made headlines. However, its approach is more incremental, focusing on affordability, scale, and steady technological improvements. Coupled with the fact that it's Chinese, it hasn't been afforded the same attention by investors. BYD trades at far lower valuation multiples and has recently overtaken Tesla in global EV sales, especially in China and Europe. Meanwhile, Tesla commands a huge premium based on its potential to lead in autonomy and AI-driven transport. However, the execution risk is huge. For value-focused investors, BYD is the obvious choice, but clearly the market favours Tesla and Elon Musk's ambitions. The post Does BYD or Tesla stock offer the best value? appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool James Fox has no position in any of the shares mentioned. The Motley Fool UK has recommended Tesla. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
