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Investment bank Benchmark added Tesla (TSLA) to its Best Ideas List but cut its price target on the shares to $350 from $475, Schwab Network reported today.
Benchmark believes that the recent decline of the stock has been "overdone."
Why Benchmark Is Bullish on TSLA
Benchmark, which kept a Buy rating on TSLA, believes that the new EV which the company plans to release later this quarter may significantly boost its deliveries.
Further, the investment bank is "cautiously optimistic" about the upcoming launch of the company's robotaxis. The latter initiative is expected to kick off in June.
Also importantly, Benchmark expects TSLA to benefit from the fact that it manufactures many of its EVs in the U.S. As a result, tariffs are likely to harm the automaker to a lesser extent than many of its peers, the investment bank believes.
Finally, the company's Optimus robots could allow it to become "a broad automation provider,” according to Benchmark.
The Recent Price Action of TSLA Stock
In the last month, the shares are down 7%, while they have sunk 41% in the last three months.
While we acknowledge the potential of TSLA, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TSLA but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
