Tesla shares could climb 21% from their recent close as Barclays upgrades the electric vehicle stock to overweight from equal weight and hikes its price target to $450 from $370, driven largely by expectations of a potential merger with SpaceX.
Barclays Upgrade Cites SpaceX Merger Potential
The recent dialogue around Tesla has skewed heavily to a potential combination with SPCX,
analyst Dan Levy said Monday in a note to clients, as detailed in the source. With a combination heavily expected, and with expectation for some premium to TSLA stock, we believe this should drive upside for the stock.
Elon Musk addressed the prospect recently, stating that a Tesla-SpaceX merger would be a good idea
and confirming that committees at both companies have been formed to discuss a potential combination. Shares of Tesla have fallen more than 17% year to date as committees at both companies have been formed to discuss a potential combination with SpaceX.
Auto Recovery and Energy Demand Support Bullish Outlook
Beyond the aerospace combination, fundamental business metrics provide additional backing for the bullish stance. The core automotive division is recovering after consecutive years of decline. The auto business is on track to grow this year after two years of declines, and 2027 should see further upside, supported by demand spurred by [full self-driving], as well as rising exports from Giga Shanghai,
Levy wrote.
Tesla’s energy sector also exhibits high demand metrics. According to Barclays, the energy business is nearly sold out for 2027 due to high order volumes from data centers. This demand trend could support shipment growth exceeding 50%. Meanwhile, the company’s autonomous vehicle fleet has registered a sharp increase in miles driven, boosting analyst confidence in Tesla’s ability to compete directly against rival Waymo.
Analysts Remain Divided on Stock Ratings
Market opinion remains divided among financial institutions. LSEG data shows that out of 49 analysts covering the stock, 25 maintain a buy or strong buy rating, while 22 issue a hold.
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