Analysts review Tesla’s latest self-driving software

Tesla’s latest autonomous driving software, Full Self-Driving (FSD) version 12.5, has received mixed reviews from analysts.

FSD 12.5.1 starts wide release today.

Please connect your Tesla to WiFi to receive the update.

— Elon Musk (@elonmusk) July 29, 2024

William Stein, a five-star analyst from Truist Securities, recently test-drove the software and found it impressive but not fully autonomous. During the test drive, Stein noted some positive advancements, such as the software’s ability to handle complex traffic scenarios like lane closures and heavy potholes.

How far other auto companies are from Tesla's FSD techpic.twitter.com/8XBwY8Qk6c

— Teslaconomics (@Teslaconomics) July 30, 2024

However, he also encountered significant issues that required his intervention to avoid a collision and respond to a police officer’s hand signals during a funeral procession. Despite these challenges, optimism remains that Tesla will continue to improve its autonomous features. However, caution is advised that these advancements may not be ready before the October robotaxi event.

I remember so many people telling me buying $TSLA at $15 per share at a ~$50B valuation was a really bad idea bc the company was overvalued, going bankrupt, and that I was going to lose it all.

Today Tesla stock sits at $230 per share at a ~750B valuation and people are saying… pic.twitter.com/T7M6Xpvea8

— Teslaconomics (@Teslaconomics) July 29, 2024

Analysts’ mixed take on FSD

Piper Sandler, on the other hand, is encouraging investors to buy Tesla shares, asserting that the company “may have solved the Self-Driving puzzle.” The firm believes that the overwhelmingly favorable reviews from users position FSD version 12.5 as a revolutionary step forward in autonomous driving technology. Piper Sandler also discussed Tesla’s upcoming plans, including the potential launch of a fully self-driving car model as soon as next year and the possibility of increasing subscription prices for FSD as the technology advances. Tesla’s Robotaxi ambitions to have a fleet of vehicles that will drive themselves and earn revenue by acting as driverless taxis will be an important catalyst for both the company and its stock. However, the bears see significant challenges ahead, as the Robotaxis will almost certainly face performance and regulatory hurdles before becoming mainstream. Overall, analysts have a Hold consensus rating on Tesla stock based on 11 Buys, 12 Holds, and seven Sells assigned in the past three months. After a 13% decline in its share price over the past 12 months, the stock currently stands at $213.92 per share, implying a 7.83% downside risk.