What Happened?
Shares of electric vehicle pioneer Tesla (NASDAQ: TSLA) jumped 5.5% in the afternoon session after the company's unsupervised robotaxi service launched in Austin over the weekend, the most concrete step yet toward the autonomous revenue story the stock has been pricing in, while JPMorgan's upgrade continued to provide institutional support in a broader risk-on session.
On June 6, Tesla commenced its unsupervised robotaxi service in Austin, Texas, fully autonomous operations, no safety driver, the milestone Tesla's valuation has been making a long-dated bet on. Further boosting sentiment, figures from the China Passenger Car Association showed the company's retail sales in the country jumped 22.5% in May to 47,281 vehicles. This snapped a two-month streak of year-over-year declines.
After the initial pop, the shares cooled down to $409.76, up 4.8% from the previous close.
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What Is The Market Telling Us
Tesla’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 6.9% after reports emerged that the company pushed its next-generation Roadster demo to August.
A JPMorgan upgrade from Underweight to Neutral, with a price target raised 228% to $475, was not enough to offset the news. The Roadster delay is not just about one car. Tesla has not launched a genuinely new vehicle since the Cybertruck in November 2023.
The demo was first set for April 1, then pushed to "May or early June," and is now being pushed again to August. The JPMorgan upgrade illustrates the investor dilemma: the analyst raised his target from $145 to $475 and framed Tesla as a "physical AI" company with an earnings inflection expected in 2028, while stopping short of a Buy.
At the current valuation multiples, Tesla is not priced as a car company. Every delayed product milestone that is supposed to justify that valuation is a direct hit to the thesis.
Adding to the weakness, a stronger-than-expected May jobs report fueled concerns that the Federal Reserve will keep interest rates elevated. A prolonged high-interest-rate environment can create headwinds for growth stocks like Tesla, as it pressures stock valuations by making future earnings less valuable in the present.
Tesla is down 6.5% since the beginning of the year, and at $409.76 per share, it is trading 16.4% below its 52-week high of $489.88 from December 2025. Despite the year-to-date decline, investors who bought $1,000 worth of Tesla’s shares 5 years ago would now be looking at an investment worth $2,037.
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