Barclays upgraded Tesla to ‘Overweight’ and raised the price target, citing potential premium for Tesla shareholders due to the expected merger.
- Barclays expects Tesla’s automotive business to return to growth this year, with further upside in 2027.
- The brokerage expects Tesla’s energy storage shipments to grow more than 50% in 2027.
- Last week, CEO Elon Musk confirmed that Tesla and SpaceX had formed independent committees to explore a possible combination.
Tesla (TSLA) has continued to find favor on Wall Street, with Barclays being the latest firm to upgrade the stock and increase its price target, citing a potential merger with SpaceX (SPCX).
On Monday, analyst Dan Levy upgraded Tesla to ‘Overweight’ from ‘Equal Weight’ and raised the price target to $450 from $370, representing a near 19% upside from current levels.
Last week, CEO Elon Musk confirmed that Tesla and SpaceX had formed independent committees to explore a possible combination. Musk called the merger a “good idea,” citing opportunities to combine AI, semiconductor manufacturing, robotics and connectivity. However, he emphasized that an agreement is not a “certainty.”
Barclays raised its price target, citing a potential takeover premium for Tesla shareholders.
At the time of writing, TSLA shares were up 2.3% in pre-market trading. Despite being the worst-performing Magnificent 7 stock in 2026, Tesla is leading the cohort in October, with more than 7.3% gains.
Barclays Is Optimistic On FSD, Robotaxi Growth
Tesla reported third-quarter revenue of $28.05 billion, below analysts’ estimates of $28.3 billion, according to Fiscal.ai. Adjusted earnings fell to $0.48 per share from $0.50 but beat Street estimates. Vehicle deliveries declined 2% to 486,532 units.
Despite mixed results, Barclays expects Tesla’s automotive business to resume growth this year, with further upside in 2027, according to Investing.com. The firm’s thesis is supported by increased adoption of Full Self-Driving (FSD) and higher exports from its Shanghai factory.
The brokerage also expects Tesla’s energy storage shipments to grow by more than 50% in 2027, driven by strong data-center demand.
Barclays also noted that Tesla’s Robotaxi business is showing signs of growth following a slower-than-expected rollout after its launch last year. Tesla said that cumulative unsupervised Robotaxi miles increased eightfold during Q3.
Meanwhile, more than 75% of new Tesla vehicles delivered in North America included FSD subscriptions.
Retail’s Take On Merger Talks
Despite the positive stock movement, retail sentiment surrounding TSLA on Stocktwits remained ‘bearish’ over the past 24 hours, amid ‘high’ message volumes.
Tesla shares have declined more than 15% so far this year, significantly underperforming the Roundhill Magnificent Seven (MAGS) ETF’s 6.7% gains.
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