Tesla Stock Up 25% In Q3: Fund Manager Says Brace For More Strength Before Momentum Fades In Q4

Tesla shares could remain resilient through the end of the third quarter as analysts lift delivery estimates but momentum may fade in the fourth, according to The Future Fund Managing Partner Gary Black. 

The Tesla stock has gained nearly 25% so far in the third quarter amid the broader market strength, robotaxi hopes and expectation that Elon Musk may finally be able to give his attention to his electric venture after his fallout with President Donald Trump.

Posting on X, Black said he expects 470,000 deliveries for the third quarter versus Wall Street's 432,000 consensus, a potential beat that he believes hedge funds are trading into Sept. 30 before unwinding.

Black pointed to the planned removal of robotaxi safety monitors at year-end as the bigger long-term catalyst. He said Tesla could expand its fleet from“150 cars now in Austin/SFO to potentially thousands,” but cautioned that even a 5,000-vehicle robotaxi fleet would add just $0.08–$0.10 per share in 2026 earnings at current promotional pricing.

He was more skeptical about Tesla's push into affordable vehicles, despite the company's latest updates. During its second-quarter earnings call, Tesla said it completed the first builds of a new low-cost lineup in June and plans to begin volume production in the second half of 2025. 

CEO Elon Musk confirmed these models would be available in the fourth quarter, after the Sept. 30 expiry of federal EV tax credits, to avoid cannibalizing sales of the Model 3 and Model Y. Musk has previously said the target was to bring costs under $30,000, including credits. However, the company has not confirmed pricing.

Black argued that unless the $35,000 model is a new form factor distinct from the Model Y, it risks repeating the 2023–2024 cycle of price cuts that led earnings estimates to fall by 50%.“In the long run, earnings certainly matter, but for TSLA investors today, further earnings cuts don't seem to be impacting the stock price,” he said.

Last week, Black said Tesla's Q3 deliveries should come in about 5% above consensus as customers rush to claim expiring federal credits worth $7,500 for new EVs and $4,000 for used models. 

He forecast a record quarter for U.S. sales, up 10–15% year over year, versus the 462,890 vehicles delivered in Q3 2024.

Still, he expects full-year volumes to fall 10% to 1.61 million, matching Street consensus and down from 1.77 million in 2024. While Tesla continues to highlight its ambitions in artificial intelligence, robotics and autonomous vehicles, Black said electric cars remain the backbone of the company, accounting for 80% of profits. 

Tesla has already reported year-over-year delivery declines in the first and second quarters of this year. Black said The Future Fund has no current Tesla position and would only consider reentering if shares fell to $240 or lower.

On Stocktwits, retail sentiment was 'extremely bullish' amid 'high' message volume.

Tesla's stock has declined 2% so far in 2025.

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