In the search for robotaxi stocks, Elon Musk’s Tesla (NASDAQ: TSLA) is one of the undisputed leaders and that remains the case despite an early September slump on the back of Cybercab news that some analysts say underwhelmed.
That pullback, arguably modest by the standards of Tesla, was likely the reflection of the electric vehicle (EV) giant not unveiling explicit robotaxi stock-related guidance and the bar consistently being set, perhaps unreasonably so, high when it comes to Tesla product events. However, investors that see the forest through the trees may well come away feeling as the Cybercab affirms Tesla’s positioning as one of the most viable robotaxi stocks for the long-term.
“Following the event, Tesla's website featured a page that allows a fleet operator to sign up to purchase a fleet of Cybercabs in the future,” observes Morningstar analyst Seth Goldstein. “This signals Tesla's long-term strategy to pivot to an asset-light model where it sells then operates the vehicles. This should maximize free cash flow.”
Robotaxi Stock Label Meaningful to Tesla
While it could take a while for Tesla’s perch as one of the premier robotaxi stocks to bear fruit, the status is potentially impactful because broadens an already robust revenue-generating ecosystem.
“Tesla remains the undisputed leader in electric vehicles, energy storage, and autonomous driving technology, powered by its vertical integration, Gigafactory network, and full self-driving (FSD) software that seamlessly integrates with vehicle hardware, energy products, and future robotics,” notes ETF issuer Direxion. “The company maintains a vast installed base of millions of vehicles and rapidly growing energy deployments worldwide, fostering exceptionally high switching costs through its Supercharger network, over-the-air updates, and ecosystem of sustainable energy solutions.”
Indeed, Cybercab could be a legitimate though longer-ranging spark for Tesla’s FSD, also known as autonomous driving software, ambitions.
“We view the launch of the Cybercab as a positive step forward for Tesla's autonomous driving software,” adds Goldstein. “The vehicle will be unique in that it will not have a steering wheel or pedals, so Tesla deploying these shows the software continues to advance through testing, in line with our outlook.”
Robotaxi Stocks Have an Audience
Tesla’s podium positioning in the robotaxi stock race is also relevant because this a theme that has an audience and the potential to deliver long-term growth. Consider remarks from Uber CEO Dara Khosrowshahi on the company’s second-quarter earnings conference call.
“We also continue to invest behind one of the largest opportunities in Uber’s history, autonomous vehicles,” he said. “We’re executing with discipline today while building the capabilities we believe will define Uber’s next decade of growth.”
On the robotaxi front, Tesla and Uber aren’t partners, but the former could leverage Cybercab to become a real threat to Lyft and Uber, much as those companies altered the old guard taxicab industry. It could take time for that competition to materialize in earnest, but over the near-term, robotaxi stock investors and those considering Tesla should keep their eyes on Texas.
“Launch of a fleet of unsupervised Cybercabs across Austin, Houston, and Dallas for paid retail rides. There is no magic number, but we believe the market needs to see more than a handful (~5-10) Cybercabs on the road,” according to Morgan Stanley. “If Tesla successfully launches 25-50 Cybercabs across Texas in the days/weeks following the launch event, we expect the stock to react favorably.”
