Analyst makes surprising prediction about Tesla stock despite major concerns: 'Likely to overshadow'

Despite recent legislation that has rolled back electric vehicle and other renewable energy tax incentives, one analyst believes Tesla will continue to be profitable, in accordance with his $400 per share price target and the stock's "Overweight" rating.

According to Teslarati, analyst Alex Potter released an investor note, estimating that Tesla would earn $3 billion in zero-emission vehicle credits, only $500,000 less than in 2024.

Potter posited that even with the One Big Beautiful Bill Act's cutting of EV incentives, such as the $7,500 federal tax credit on qualified EV purchases, the effect on the EV titan will likely be slight.

"Tesla will still book around $3B in credits this year, followed by $2.3B in 2026," Potter said, according to an X post Teslarati shared from software developer Hardick Shah (AIStockSavvy), who posted a screenshot of the investor note.

In early 2025, Tesla sales saw record declines in early 2025, in part due to CEO Elon Musk's polarizing involvement in U.S. politics. However, developments like Tesla's robotaxi service — which has recently been updated and expanded in Austin, Texas — as well as the company's continued efforts to perfect the Full Self-Driving program have sparked optimism for the brand.

Despite ongoing efforts, concerns still remain about the safety of Tesla's supervised FSD systems and other autonomous features.

"In our view, these favorable FSD-related developments are likely to overshadow any/all negative commentary arising from lower 2025/2026 estimates," Potter said, as reported by Teslarati.

Though the federal tax credit on EVs is set to end by Sept. 30, increased releases of affordable EVs, as well as a growing used EV market, have made going electric feasible for more people.

Plus, by switching to an EV, not only do people save money on maintenance, as there's no need for gas or oil changes, but they also contribute to healthier air quality. EVs do not emit the toxic tailpipe exhaust like gas-powered cars. It can be a win for your wallet and the Earth.

If you do switch to an EV, installing solar panels can help you make the most of its benefits by keeping charging costs down and promoting your personal investment in clean energy even further. If you aren't sure where to start with solar panel installation, EnergySage provides free estimates and other resources to find which option is best for you.