Bank of America Reinstates Tesla Buy with $460 Target on Robotaxi Growth
Bank of America reinstated a Buy rating on Tesla with a $460 target, citing its leadership in autonomous driving and robotaxi expansion to nine markets in early 2026. Q4 revenue slipped 3% to $24.90 billion while energy storage sales jumped 25% to $3.84 billion and gross margin rose to 20.1%.
1. Bank of America Restores Buy Rating
Bank of America reinstated a Buy rating on Tesla with a $460 price target, highlighting its leadership in autonomous driving and its expansions into nine robotaxi markets by mid-2026.
2. Q4 Financial Results
Tesla reported Q4 revenue of $24.90 billion, down 3% year-over-year, with automotive revenue falling 11% to $17.7 billion and deliveries slipping 16% to 418,227 units, while energy storage sales rose 25% to $3.84 billion, services grew 18% to $3.37 billion, and gross margin reached 20.1%.
3. Strategic Pivot to AI and Robotics
Tesla is reallocating capital toward AI and robotics, planning roughly $20 billion in 2026 capex to build new factories and develop Optimus humanoid robots, Cybercab robotaxis, Tesla Semi and Megapack 3 for volume production.
4. Market Performance and Outlook
Shares are down about 11% year-to-date but up 51% over the past 12 months, with a $1.52 trillion market cap and mixed analyst sentiment reflecting confidence in long-term AI potential against near-term automotive headwinds.