Introduction
As Tesla prepares to announce its third-quarter vehicle deliveries, analysts are optimistic about the company’s performance, with expectations set to exceed 440,000 vehicles. Benchmark, a leading investment firm, has reiterated its "Buy" rating on Tesla stock (NASDAQ: TSLA) and maintains a price target of $475. This comes at a time when Tesla's stock has shown remarkable resilience and growth, closing the third quarter at $444.72 per share, which translates to a market capitalization of approximately $1.479 trillion.
Analyst Forecasts
Benchmark analyst Mickey Legg has projected that Tesla will deliver around 442,000 vehicles for Q3, which, while slightly below the consensus estimate of 448,000 units, represents a significant increase from the 384,000 vehicles reported in the previous quarter. Legg noted, "Some optimistic estimates for Tesla’s Q3 deliveries are as high as mid-460,000s," indicating an overall positive outlook among analysts.
"Tesla is expected to report 3Q25 global production and deliveries on Thursday. We model 442,000 deliveries versus ~448,000 for FactSet consensus with some high-side calls in the mid-460,000s. A solid sequential uptick off 2Q25’s ~384,000, a measured setup into year-end given a choppy incentive/pricing backdrop," said Legg.
Positive Sentiments from Other Analysts
Benchmark's optimistic predictions are echoed by other financial institutions. For instance, Deutsche Bank has increased its delivery forecast to an impressive 461,500 units, demonstrating confidence in Tesla's ability to meet and exceed expectations. Additionally, Piper Sandler has adjusted its price target for Tesla to $500, following a recent visit to China that provided insights into current market conditions. Cantor Fitzgerald also maintained an "Overweight" rating with a $355 price target for Tesla stock.
The Impact of EV Tax Credits
A significant factor contributing to Tesla's expected delivery surge is the impending expiration of the federal EV tax credit in the United States. Analysts believe that this has encouraged many potential buyers to expedite their vehicle purchases to take advantage of the benefits before they disappear. This urgency in purchasing coincides with a 30% increase in Tesla's share price throughout September, further raising expectations for a strong quarterly report.
Market Reactions and Stock Performance
Despite the positive momentum, Benchmark has cautioned investors about potential volatility in the coming quarter. As the stock has surged by approximately 28-32% in September alone, there is an increased expectation for an upside surprise. However, Legg warns that if regional delivery mix or average selling prices (ASPs) fall short, it may lead to downward pressure on the stock.
"With the stock up sharply into the print, its positioning raises the bar for an upside surprise to translate into further near-term strength; we also see risk of volatility if regional mix or ASPs underwhelm," Legg noted.
Looking Ahead
As we approach the end of Q3, the automotive industry is bracing for potential shifts due to changes in EV incentives and credits. Analysts at Benchmark anticipate that the tightening of these incentives could create demand fluctuations in Q4. Such conditions might result in a "temporary air pocket" in demand and lumpiness in the order book, presenting challenges for Tesla as it navigates the changing landscape.
Conclusion
In summary, Tesla's Q3 delivery numbers are set to surpass 440,000, with analysts maintaining a positive outlook on the company's performance, bolstered by the expiration of federal EV tax credits and a favorable market response. However, the potential for volatility remains a concern as the company faces a shifting competitive landscape and policy changes affecting EV purchases. Investors and stakeholders will be keenly observing the upcoming delivery report for insights into Tesla's operational health and market positioning.
