Tesla (TSLA) shares surged over 7% on Friday, September 12, 2025, closing at $395.94, up $27.13 from its previous close of $368.81. This strong performance marks the stock’s best weekly advance in three months.
Key Market Dynamics
- Market Optimism: Tesla’s stock rebound, climbing approximately 10% through Thursday and adding another 7% on Friday, is nearing its year-end 2024 level of around $404 after hitting lows near $222 in March.
- Energy Storage Boost: The recent surge is partly attributed to Tesla’s expansion of its energy storage offerings, including the new Megapack 3 battery unit and the large-scale Megablock system, designed to lower costs and installation times for energy projects. Tesla’s energy generation and storage revenue increased 18% year-over-year to $5.5 billion in the first half of 2025, offsetting a decline in automotive revenue during the same period.
- Federal Reserve Expectations: Investor anticipation of a Federal Reserve rate cut next week is also lifting sentiment for big tech stocks, including Tesla.
- Technical Trading and Short Squeeze: Some traders see the rally as potentially driven by technical trading patterns and a possible “short squeeze” where short sellers are forced to buy shares to cover positions.
- Focus on Robotics and AI: Despite caution around the core EV business, investors are showing interest in Tesla’s potential in robotics and autonomous driving advancements.
- CEO Pay Package: The board’s recent offer of a new pay package to Elon Musk may be easing concerns about his long-term commitment to the company.
Analyst Perspectives
- Despite the recent rally, Wall Street analysts remain cautious, with a mean price target of approximately $327, below the current trading levels.
- Visible Alpha data shows a balance of bearish and neutral ratings alongside bullish calls.
- Tesla is currently valued at around 75 times its EBITDA, which some analysts question given the recent softness in vehicle sales