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Tesla is set to kick off deliveries of its long-awaited Cybertruck Thursday, but not everyone on Wall Street is convinced the debut will move the needle in terms of stimulating growth for the Elon Musk-run company. “We remain SELL rated as we do not believe the Cybertruck meaningfully changes the demand story over the next several years, which we expect to remain challenged by a lack of new product offerings, difficulty convincing the next wave of EV buyers to drive adoption and increasing competition,” wrote Guggenheim Securities analyst Ronald Jewsikow in a Wednesday note to clients. To be sure, despite some cautionary commentary from major Wall Street firms, Tesla shares have almost doubled in 2023 as investors veered back into growth stocks. The stock, which tumbled 65% last year, also benefited from a broad-based risk-on market rally in November as Treasury yields fell, boosting shares nearly 22%. Jefferies analyst Philippe Houchois half jokingly floated the idea of canceling the Cybertruck ahead of its launch, kept his hold rating but cut his price target on the shares by 10% last week, saying that Tesla may be better off devoting capital to support residual values that are under pressure from price cuts and higher interest rates. “However unlikely just a few days before first deliveries, canceling Cybertruck would probably be positive for shares,” he wrote in a report to clients while reducing his Tesla price target to $210 from $250 a share. “With 2024 already a lost year for growth, it would help Tesla refocus on an edge that was built on simplicity, scale and speed.” RBC Capital Markets analyst Tom Narayan retained his outperform rating on Tesla shares, saying in a note to clients this week that the new truck could serve as a potential catalyst for the brand, helping it sell more Model 3 sedan and Model Y hatchback SUV. At the same time, Narayan expects the truck to have little impact on 2024 financials, when it is estimated to account for only about 3% of total Tesla sales before rising to 6% in 2025. TSLA YTD mountain Tesla shares year to date RBC views the Cybertruck as a “halo truck” that can “reinvigorate a brand that has arguably lost some of its shine in the past few years given a lack of new models,” Narayan wrote. Guggenheim’s Jewsikow expects elevated pricing when the Cybertruck debuts, modeling the average selling price per unit coming in at around $90,000 for the fourth quarter of 2023, and a driving range between 275 and 300 miles per charge. By itself, however, the new truck won’t help Tesla’s shares, Guggenheim believes. Jewsikow most recently retained a $125 price target on the stock, implying 49% downside from Wednesday’s close. — CNBC’s Michael Bloom contributed reporting
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