Tesla stock (NASDAQ: TSLA) opened trading at $381 following a significant drop, pressured by declining global sales and a regulatory probe. According to a Reuters report, the company is under scrutiny in Europe for potentially exaggerating full self-driving safety data. Despite these challenges, investment bank Baird reiterated an Outperform rating and a $522 price target for TSLA, suggesting a potential 37% return. Analysts noted a possible merger with SpaceX could happen “sooner” rather than “later,” which they cited as a company-specific catalyst.
Tesla stock opened Wednesday’s session at $381 after falling nearly 6% the previous day. The electric vehicle maker faces a challenging year with falling prices due to a worldwide dip in sales.
Traffic safety regulators in Sweden and the Netherlands are now scrutinizing the company following a Reuters report stating Tesla presented misleading full self-driving safety data to European regulators. This regulatory pressure and inflated safety data are affecting the stock’s market prospects.
However, investment banking firm Baird wrote in a note to clients that Tesla could soon merge with SpaceX, which would increase its prospects. The note read that a merger could likely happen ‘sooner’ rather than ‘later’.
Baird’s analysts reiterated their Outperform rating with a buy call for the stock. They maintained their most bullish price prediction for TSLA at $522, implying an approximate 37% return from its current price.
The note also confirmed that Baird continues to buy Tesla stock with the company-specific catalysts ahead. The investment bank is betting on the potential merger and accumulating shares for clients.
