Why Tesla Stock Is Soaring Today Even as Tariff Trouble Mounts

Shares of Tesla (NASDAQ: TSLA) are rebounding on Wednesday. The electric vehicle (EV) stock gained 5.2% as of 1:05 p.m. ET after gaining 6.4% earlier in the day. The bounce comes as the S&P 500 and Nasdaq Composite were green even as more retaliatory tariffs on the U.S. were announced.

A Wall Street firm added Tesla to its "best ideas" list despite recent troubles, claiming the stock sell-off is overdone.

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Benchmark sees opportunity amid challenges

Benchmark analyst Mickey Legg released a bullish research note on Wednesday, adding Tesla to the firm's "best ideas" list. The analyst acknowledged the stock's recent struggles amid declining sales but said he believes concerns "are overblown considering the near-term issues impacting the company and the scope of opportunities around the corner."

Legg did lower his price target to $350 from $475, but that still represents a large upside from the stock's current price around $230. Benchmark maintained a buy rating on the stock.

Future catalysts

The analyst's optimism centers on Tesla's anticipated product launches that could reverse the company's recent sales decline. "Our focus is on the release of a new TSLA model in [the 2025 second quarter], which in our view could turn around the recent decline in vehicle sales," Legg wrote. He also thinks that Tesla's robotaxi service, scheduled to launch this summer in Austin, Texas, could be a significant catalyst.

The company is promising the release of a personal robot named Optimus. Legg describes it as a possible game changer that transforms the company from a vehicle manufacturer into a broad automation provider. This aligns with CEO Elon Musk's recent statement that Tesla plans to build 5,000 Optimus robots this year.

While these plans could indeed be a game changer, their success is far from guaranteed. Neither is the timeline of their release. Musk has a history of big promises that fail to materialize. It's been nearly a decade since the enigmatic CEO chief said that his cars would soon be fully autonomous, but he still has yet to deliver on that core promise. I would avoid Tesla stock for the time being.

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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.