Tesla, Inc. (TSLA) stock rose 0.3% overnight late Sunday after the company announced plans to significantly increase production at its German factory, while Morningstar raised its fair value estimate and forecast a 10% delivery rebound in 2026. The electric vehicle maker's shares had fallen 3% on Friday to close at $380.84, marking its worst weekly performance in over a month. Tesla's Grunheide plant, which supplies more than 30 markets, is targeting output of up to 7,500 vehicles per week—or approximately 375,000 annually—as Model Y demand improves, with the expansion expected to create about 3,500 jobs and increase battery production. Morningstar increased its fair value estimate for Tesla to $450 from $425, projecting deliveries will grow roughly 10% in 2026 to nearly 1.8 million vehicles from 1.64 million last year, with higher automotive gross profit margins expected in the high teens excluding regulatory credits. The developments come ahead of Tesla's second-quarter earnings report scheduled for Wednesday after market close, with analysts expecting revenue of $26.36 billion and adjusted earnings per share of $0.54.
Tesla Targets 7,500 Weekly Vehicles at Germany Plant
Tesla expects "a significantly higher production volume" at its Grunheide plant this year as Model Y demand improves, according to Bloomberg. The factory is targeting output of up to 7,500 vehicles per week, or 375,000 annually. Tesla also plans to expand battery production, with the broader push expected to create approximately 3,500 jobs. The production ramp follows fresh hiring and a recovery in European registrations after two years of declining sales. Since Grunheide builds only the Model Y, stronger demand feeds directly into factory utilization.
Morningstar Raises Tesla Fair Value to $450, Forecasts 10% Delivery Growth
Morningstar raised its fair value estimate for Tesla to $450 from $425, implying an 18% upside from Friday's closing price. The firm rates the stock '3-star', with a 'Narrow' moat and 'Very High' uncertainty. Morningstar expects Tesla deliveries to rise approximately 10% in 2026 to nearly 1.8 million vehicles, up from 1.64 million last year. The firm stated the higher forecast should drive "higher automotive gross profit margins," with margins excluding regulatory credits expected to be in the high teens. Lower-priced versions of the Model Y and Model 3 are expected to support growth, partly offsetting weaker U.S. demand following the expiration of the federal EV tax credit.
Analysts Expect $26.36 Billion Revenue in Q2 Earnings
Tesla reports second-quarter results after the market close on Wednesday. According to Koyfin, analysts expect revenue of $26.36 billion, up 18% from $22.39 billion a quarter ago. Adjusted earnings per share is projected to rise 31% to $0.54, while earnings before interest, taxes, depreciation and amortization (EBITDA) is expected to increase 8% to $3.97 billion. Morningstar stated Tesla posted "strong delivery growth" during the quarter, shifting attention to margins, free cash flow and capital spending. Investors will also look for updates on the Cybercab, robotaxi expansion, Full Self-Driving version (FSD) 15 and Optimus, which Morningstar called a "large long-term growth driver."
Tesla Holds $44.7 Billion Cash Amid AI Spending Concerns
Morningstar stated Tesla is in "excellent financial health," with $44.7 billion in cash, equivalents and investments as of March 31. However, the firm's 'Very High' uncertainty rating is due to intense EV competition, potential price cuts, and heavy spending on AI, autonomous driving, and humanoid robots. On Stocktwits, retail sentiment for TSLA has been 'bullish' over the past week amid a 31% rise in 24-hour message volumes. One user expressed concern that raising capital expenditures on Wednesday could trigger a sell-off similar to Meta's 2022 crash. Another user anticipated the stock reaching $450-$500 into or post-earnings, followed by a sell-off. So far this year, Tesla's stock has lagged its "Magnificent Seven" peers, making it the group's second-worst performer, down 15%.
FAQ
What production target did Tesla announce for its Germany plant?
Tesla's Grunheide plant is targeting output of up to 7,500 vehicles per week, or approximately 375,000 annually, as Model Y demand improves. The expansion is also expected to create about 3,500 jobs and increase battery production.
What is Morningstar's fair value estimate for Tesla stock?
Morningstar raised its fair value estimate for Tesla to $450 from $425, implying an 18% upside from Friday's closing price of $380.84. The firm expects deliveries to grow roughly 10% in 2026 to nearly 1.8 million vehicles, with automotive gross profit margins in the high teens excluding regulatory credits.
When does Tesla report Q2 earnings and what are analyst expectations?
Tesla reports second-quarter earnings on Wednesday after market close. Analysts expect revenue of $26.36 billion (up 18% quarter-over-quarter), adjusted earnings per share of $0.54 (up 31%), and EBITDA of $3.97 billion (up 8%).
