Tesla, the EV maker, faced challenges in 2025 with a 30% stock drop and weakening sales in key markets. Concerns grew over CEO Elon Musk’s political involvement, but a renewed focus on Tesla boosted investor confidence. Record sales and a proposed $975 billion pay package for Musk signaled a potential turnaround.

Tesla’s latest rally, driven by progress in autonomy, saw the stock hit record highs. Reports of testing fully driverless robotaxis in Austin pushed Tesla’s valuation to around $1.6 trillion. Despite competition from Alphabet’s Waymo, Tesla’s move towards fully autonomous testing has been a major catalyst for the stock surge.

Beyond EV sales, Tesla’s future lies in autonomy and AI-driven systems. With advancements in self-driving technology, robotaxi networks, and energy storage, Tesla’s story is shifting towards long-term opportunities. Ambitions in humanoid robots and AI applications show real potential for Tesla beyond traditional car sales.

Tesla’s stock has gained 21% this year, trading above moving averages with a forward sales multiple of 15.4X. Despite high valuations, Tesla’s focus on long-term potential keeps investors interested. Projections for 2026 show revenue and EPS increases, highlighting the company’s growth potential and unique position in the market.

Tesla remains a high-risk, high-reward investment for 2026. Challenges persist, but with Musk’s vision driving innovation in autonomy and AI, Tesla offers a unique bet on the future of mobility. Investors willing to weather volatility could see long-term gains as Tesla’s story evolves beyond traditional car sales.

Read more at Nasdaq: Tesla’s Rollercoaster Ride in 2025: How Is It Placed for 2026?