Upgraded Outlook and a Break in Momentum

After several quarters of sluggish performance, Canaccord Genuity’s decision to lift its price target for Tesla represents a notable positive shift. Analysts highlighted delivery data from roughly 30 countries showing clear signs of strengthening demand. While other firms have also revised forecasts higher, the continued upgrades underscore renewed confidence in Tesla’s growth trajectory.

New EV Models – A Catalyst for Sales Growth

On the automotive front, Tesla is set to roll out new EV models, as management previously indicated. These launches could help sustain global sales momentum and mitigate the risk of a demand cliff in the U.S. once federal EV tax credits begin to phase out post-Q3. The introduction of fresh models will not only broaden Tesla’s product lineup but also reinforce its competitive positioning against rising Chinese and European players.

Energy Storage – The Hidden Growth Engine

Beyond vehicles, Tesla’s energy storage division is becoming increasingly strategic. Hyperscale data centers and industrial players are seeking solutions not fully reliant on the main utility grid. This is where “behind-the-meter” systems come into play—distributed generation setups that deliver power directly onsite while still connecting to the broader grid for resiliency.

Reliance on traditional grid power is facing mounting pushback as utilities and regulators grapple with rising prices and reliability concerns. Even Elon Musk has leaned on behind-the-meter solutions, as seen with the use of gas turbines at Tesla’s xAI facility in Memphis. While that choice drew environmental criticism, it highlighted the growing importance of decentralized energy systems.

Looking Ahead – Opportunities and Challenges

Canaccord’s raised price target reflects optimism not only for Tesla’s EV segment but also for its expanding role in the energy ecosystem. Energy storage is likely to become a major growth engine, particularly as demand surges from data centers, industrial applications, and local grids seeking resilience.

Still, risks remain. Tesla faces intensifying competition, stricter environmental regulations, and questions around the pace of government incentives. Investors will need to monitor the company’s ability to scale energy solutions alongside new model launches, while maintaining its technological edge without operational or regulatory setbacks.