Barclays Sees Tesla Stock as a Potential Outperformer Despite Weakening Fundamentals
Barclays believes Tesla (NASDAQ: TSLA) shares might still outperform in the wake of Q2 results, even though the company is grappling with deteriorating core metrics.
In a recent research note, analysts at Barclays described the situation as “confusing,” but acknowledged there’s still room for upside.
“Overall, we see potential for outperformance,” the analysts wrote, pointing to growing investor interest in Tesla’s long-term plans for autonomous vehicles and robotaxis.
They also noted that the upcoming earnings call could serve as a platform for Elon Musk to spotlight Tesla’s AV and robotaxi strategy, possibly by discussing targets for fleet expansion or future growth initiatives.
Although Tesla’s auto gross margin (excluding regulatory credits) is expected to show modest sequential improvement, Barclays cautioned that margins are still significantly below previous years’ levels.
The firm is projecting a 10% decline in Tesla’s vehicle deliveries for 2025, describing the first half of the year as “soft” and noting a steep reduction from prior expectations. Earlier in the year, consensus EPS for 2025 was over $3.20; it has since fallen to $1.84.
Barclays also warned that the anticipated delay of Tesla’s affordable vehicle model could dampen investor sentiment. The company is likely to emphasize third-quarter sales ahead of the U.S. EV tax credit expiration on September 30, possibly postponing the budget model’s release to Q4—something that could be viewed negatively.
Nevertheless, Barclays maintains that the strength of Tesla’s autonomous vehicle narrative may be enough to counterbalance its weakening financials in the short term.
