Morgan Stanley analyst Adam Jonas said the biggest long-term risk to Tesla is that competitors could offer mobility services at a loss just to access consumer time and data. In that context, he believes that Tesla's reported plans to offer its customers a music streaming service makes sense and looks for the company to make further moves into original branded content and experiences as it strives to be "more than a 'dumb pipe'" for its driver, and eventually rider, base. Jonas keeps an Equal Weight rating and $305 price target on Tesla shares.

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Deutsche Bank analyst Emmanuel Rosner downgraded Tesla to Hold from Buy with a price target of $123, down from $189. The analyst cites the "high likelihood" of Model 2 push-out and the company's change of strategic priority to Robotaxi for the downgrade. Deutsche's Buy rating was predicated on Tesla's next-generation vehicle priced at $25,000 coming late next year, which would allow the company to reaccelerate volume, margins and free cash flow, and potentially come to dominate the Western electric vehicle market, the analyst tells investors in a research note. However, pushing out the Model 2 will create "significant" earnings and free cash flow pressure on 2026 and beyond estimates, and make the future of the company tied to Tesla "cracking the code on full driverless autonomy," which represents a "significant technological, regulatory and operational challenge," says Deutsche Bank. The firm views Tesla's shift to Robotaxi as "thesis-changing," and worries the stock will need to undergo a "potentially painful transition in ownership base," with investors previously focused on electric vehicle volumes and cost advantages potentially "throwing in the towel, and eventually replaced by AI/tech investors with considerably longer time horizon."

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Get caught up quickly on the top news and calls moving stocks with these five Top Five lists. 1... To see the rest of the story go to thefly.com. See Story Here