Tesla's Continued Rally and Future Prospects

Investing.com — Tesla's rally is expected to persist as a reduction in regulations will bolster the electric vehicle maker's autonomous operations. CEO Elon Musk's close relationship with President-elect Donald Trump is anticipated to facilitate further growth over the next four years, according to Mizuho's recent note.

Tesla Inc (NASDAQ:TSLA) surged 6% on Monday, reaching a new record high.

The loosening of the autonomous driving (AD) regulatory framework offers increased valuation potential for Full Self-Driving (FSD) and Robotaxi services, creating a favorable landscape for Tesla's expansion in autonomous technology, as noted by Mizuho analysts.

Mizuho has upgraded Tesla's rating to "outperform" and increased its price target from $230 to $515, citing unique advantages expected to emerge in the next four years.

The analysts predict that Tesla's FSD technology could achieve regulatory approval at Level 4 by 2025, significantly boosting its revenue prospects, potentially reaching around $62 billion by 2030, a considerable rise from under $1 billion today.

Musk, who supported Trump during the election campaign, is likely to influence policy decisions in the White House, which would be beneficial for Tesla.

The new administration's policies, including possible elimination of consumer EV tax credits, position Tesla advantageously against its competitors due to its lower EV cost structure, Mizuho stated.

Tesla is projected to outpace global light vehicle production with a more profitable electric vehicle strategy, particularly with the upcoming low-cost Model Q and Cybercab models expected between 2026 and 2027.