Tesla's stock showed resilience in early trading, rising 0.4% to $350.81, while broader indices like the S&P 500 and Dow Jones fell 0.1% and 0.3% respectively. This outperformance was driven by a significant regulatory milestone: the Netherlands' RDW vehicle authority granted approval for Tesla's Full Self-Driving (FSD) driver-assistance system, marking the first such approval in Europe.
Cantor Fitzgerald analyst Andres Sheppard highlighted the importance of this decision, stating it is "material" as it represents the first European country to grant regulatory approval for Tesla's FSD. He maintains a Buy rating with a $510 price target, noting Tesla expects further European approvals "soon." However, the approval comes with strict limitations—the system requires active driver supervision at all times, and the European version has tighter constraints than the U.S. version.
Concurrently, UBS upgraded Tesla's stock from Sell to Neutral, with a $352 price target, citing a more balanced risk-reward profile after the stock fell over 21% in 2026. UBS analyst Joseph Spak warned the stock "may continue to exhibit high volatility" and trades more on sentiment than fundamentals. The firm forecasts only 1.6 million vehicle deliveries in 2026—roughly flat year-on-year—and sees growth reaching just 2 million units by 2030, well below Wall Street's consensus of 3 million.
Progress on Tesla's key future projects appears slower than expected. UBS noted that Tesla's robo-taxi service, which was indicated to be operating in nine cities by the first half of 2026, is rolling out slowly in Austin, with no meaningful scaling expected near-term. Similarly, the Optimus humanoid robot program "will take longer than Musk's stated targets," with UBS modeling only 5,000 units in 2027.
Despite these long-term bets, Tesla faces near-term pressure. The company reported disappointing first-quarter deliveries of 358,023 vehicles, below the consensus estimate of 365,645, raising concerns about demand momentum ahead of its April 22 earnings report. Tesla continues to trade at a punishing premium, with a trailing P/E ratio between 295x and 325x, and a forward 2026 P/E of approximately 174x, suggesting the market is pricing in a dramatic earnings recovery that has yet to materialize.
