The Zacks Analyst Blog Tesla, BYD and Alphabet's

For Immediate Releases

Chicago, IL – January 6, 2026 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog includeTesla TSLA, BYD Co Ltd BYDDY and Alphabet’s GOOGL.

Here are highlights from Tuesday’s Analyst Blog:

Tesla EV Deliveries Slide in 2025: Time to Sell TSLA Stock?

Electric vehicle giant Tesla saw its annual deliveries decline for the second consecutive year in 2025. After deliveries declined in the first and second quarters of 2025, Tesla set a new delivery record in the third quarter, but much of it came from buyers rushing to claim the expiring $7,500 EV tax credit. Expiration of incentives, intense competition from Chinese EV makers, particularly BYD Co Ltd, and an aging fleet resulted in the year-over-year decline in Tesla deliveries in the fourth quarter of 2025 as well as the full year.

While TSLA’s core EV business is struggling, CEO Elon Musk is pinning big hopes on autonomous vehicles and artificial intelligence, considering those as the next fuel engines for the company. However, meaningful revenues from these projects are years away.

So, in this scenario, should investors dump Tesla stock or still hold it tight on big long-term promises? Before that, let's dig deeper into TSLA’s latest delivery numbers.

TSLA Q4 & Full-Year Deliveries Disappoint

In the fourth quarter of 2025, Tesla sold 418,227 vehicles (comprising 406,585 Model 3/Y and 11,642 other models), down 16% from the corresponding quarter of 2024. For the full year, deliveries totaled roughly 1.64 million vehicles (comprising 1.58 million units of Model 3/Y and 50,850 other models). That denotes a decline from nearly 1.8 million vehicles sold in 2024.

Another thing to be noticed here is that the rate of sales decline has also increased in 2025. In 2024, deliveries were down 1% on a year-over-year basis. In 2025, the year-over-year decline was more than 8%.

And with that, Tesla lost its EV crown to BYD, which overthrew Tesla for the first time on an annual basis. BYD logged record sales of 2.26 million BEVs in 2025, reflecting a 28% increase year over year.

Musk’s Pivot to Robotaxis & Robotics

Musk is betting big on Full Self-Driving (FSD) and robotaxis, calling them Tesla’s most valuable future segment. Its robotaxi service, launched in June, is currently operational in Austin and San Francisco, with Phoenix next after the company recently secured the required permits. Tesla has also outlined plans to expand into Las Vegas, Dallas, Houston and Miami. Notably, Tesla’s FSD fleet has surpassed 7 billion total miles.

Also, Tesla has started testing driverless robotaxis without safety monitors, which investors see as proof of progress toward autonomous mobility. Musk has also announced that Tesla’s in-car systems will integrate Grok, an AI chatbot, boosting confidence in Tesla’s ability to monetize AI.

That said, competition in autonomy remains intense. Alphabet’s Waymo continues to lead the autonomous ride-hailing race. Its entire fleet operates without safety drivers, and it recently surpassed 450,000 weekly paid rides. So, Tesla is still playing catch-up in the AV space.

Regarding robotics, Tesla’s humanoid robot project, Optimus, is seen as a long-term growth driver, adding to the narrative that Tesla is more than just an EV company.

Flourishing Energy Business

One key bright spot for the company is its Energy Generation and Storage business, which is going strong on the back of the strong reception of its Megapack and Powerwall products. This segment also stands out as Tesla's most lucrative, boasting the highest margins. In the fourth quarter of 2025, Tesla deployed a record 14.2 GWh of energy storage products. For the full year, deployments rose 48.7% to 46.7 GWh.

TSLA’s Price Performance, Valuation & Estimates

Over the past year, Tesla shares have underperformed the industry.

The company trades at more than 13.75X forward 12-month sales, far above the industry average. But Tesla has been one of those stocks whose valuation has long been divorced from its fundamentals. It has always traded at a premium, backed by promises of its long-term potential.

The Zacks Consensus Estimate for Tesla’s 2025 revenues and EPS implies a year-over-year contraction of 3% and 33%, respectively. But the consensus mark for 2026 top and bottom lines suggests an improvement of 11.6% and 42.4%, respectively, from the 2025 projected levels. See how TSLA’s EPS estimates have been revised over the past 90 days.

Tesla Shares Worth Holding Onto Now

Tesla’s delivery slowdown highlights the growing pressure on its core EV business. But Tesla is not just an EV story now. While vehicle demand faces competition and incentive-related volatility, the company continues to make steady progress in full self-driving, robotaxis, and energy storage—areas that could reshape its long-term earnings mix. At the same time, ambitions around AI and humanoid robotics offer optionality that a few automakers can match, even if monetization remains years away.

That said, investors should temper expectations. Scaling robotaxis beyond pilot programs and turning AI-led projects into consistent revenue streams will take time.

For now, Tesla is a high-risk, high-reward stock. Long-term believers should stay invested, but fresh entry points may warrant patience. And if even part of Musk’s vision comes together, TSLA could remain a winning stock for years to come.

Tesla currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Free: Instant Access to Zacks' Market-Crushing Strategies

Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.

Today you can tap into those powerful strategies – and the high-potential stocks they uncover – free. No strings attached.

Get all the details here >>

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

[email protected]                                     

https://www.zacks.com                                                 

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research