Analysts Remain Divided on Tesla Inc.’s (TSLA) Near-Term Outlook

Group 1: Investment Insights - Tesla Inc. is among the top 10 stocks to buy from Cathie Wood's ARK Investment Management, with holdings increasing to $1.6 billion by the end of Q3 2025, representing 9.5% of ARK's total 13F portfolio [1] - Mizuho's Vijay Rakesh reiterated an Outperform rating on Tesla while lowering the price target to $475 from $485 due to a softer outlook for electric vehicle demand in China and the U.S. [2] - The consensus opinion on Tesla is mixed, with only 40% of analysts recommending a Buy, and the 1-year median potential upside is a modest 2% [4] Group 2: Market Challenges - A significant factor affecting Tesla's estimates is the expected 50% decline in Chinese government subsidies for electric vehicles in 2026, which may impact industry-wide demand [3] - Tesla is facing challenges in its core EV business and pressure on vehicle sales, contributing to a cautious outlook [4] Group 3: Technological Developments - Tesla is close to finalizing the design of its AI5 chip and starting work on AI6, with plans to bring a new AI chip design to volume production every 12 months [4] - CEO Elon Musk stated that Tesla expects to build chips at higher volumes than all other AI chips combined, indicating ambitious growth plans in this area [4]