Tesla shares are climbing, fueled by developments in China. On Thursday, the stock was up 0.6% in premarket trading, adding to a gain of more than 14% over five of the last six sessions. Investors are increasingly optimistic that Tesla’s Full Self-Driving technology may soon get regulatory approval in China. While a launch could have a big impact on the stock, Wall Street remains cautious despite the recent rally.
Building on this optimism, CEO Elon Musk is traveling in China with President Donald Trump, which investors see as a positive sign for FSD approval. Tesla’s Full Self-Driving system can handle most driving tasks on its own, but it still requires a human supervisor. This technology also powers Tesla’s robotaxi service, which started in Austin, Texas, in June and has now expanded to four U.S. cities.
If China approves FSD, it would create a major new source of revenue for Tesla. The company already earns a large share of its yearly revenue from China. Introducing FSD as a subscription in the world’s biggest electric vehicle market would therefore give Tesla a steady stream of income that it does not have now.
However, this optimism comes at a cost. Tesla expects to spend about $25 billion on capital projects in 2026, almost three times the $9 billion it spent in 2025, as it grows its AI and self-driving efforts. UBS has a Hold rating and a $364 price target for the stock, noting that Tesla’s AI projects could generate significant revenue, though tangible results may take time.
About 45% of analysts rate Tesla a Buy, lower than the typical 55%-60% for S&P 500 peers. The average price target is around $400.
Featured CoursesRecent news
Alphabet Shares Rise 1.4% as $5 Trillion Market Cap Comes into View
Alphabet is close to a rare milestone. On Monday, its shares rose 1.4%, bringing the Google parent company within about 2% of a $5 trillion market value. This comes just 87 trading days after it first closed above $4 trillion in January. Let’s look at what’s fueling this growth and whether its big AI investments […]
UnitedHealth Falls 2.1% After Berkshire Exits Position Under New CEO
Berkshire Hathaway continues to shape markets, even without Warren Buffett at the helm. UnitedHealth shares fell 2.1% in early trading on Monday after Berkshire’s 13-F filing revealed it sold all its shares in the health insurer during the first quarter. This move highlights Berkshire’s new direction under CEO Greg Abel and shows the Buffett effect […]
Ford Shares Jump 6.9% on Energy Storage Deal and European Model Lineup
Ford bounced back in May, with shares rising 6.9% in premarket trading on Monday. This gain follows a 7.5% drop on Friday and continues a rally that has lifted the stock 18% this month, marking its best monthly performance since 2023. Two key announcements fueled this move, but only one is about cars. Here’s what […]
Trade with fewer limits
Day trade with fewer limits at fast speed. Buy stocks and ETFs at low fees.