Tesla’s Valuation Crossroads: Nvidia’s AI Challenge Intensifies Scrutiny

As 2026 begins, Tesla finds itself navigating a complex landscape of operational headwinds and a shifting competitive horizon. The pressure is mounting from disappointing vehicle delivery figures and, notably, a new challenge emerging from an unexpected quarter: the artificial intelligence powerhouse Nvidia. This confluence of factors has ignited a fierce debate among market experts, creating a stark divide in perspectives on the electric vehicle pioneer's future worth.

Beneath the grand visions for autonomy lies a sobering present for Tesla's core business. The quarterly report released on January 2 revealed a 16% year-over-year decline in fourth-quarter deliveries, which fell to approximately 418,000 vehicles. For the full year 2025, the company registered an 8.5% decrease in deliveries.

Analysts point to the expiration of tax credits in key markets like the United States, coupled with an intensifying price war in China and Europe, as primary drivers of this slowdown. This trend places significant pressure on CEO Elon Musk. With growth in the traditional automotive segment stalling, the company's strategic pivot toward artificial intelligence and robotics is now under the microscope, viewed as essential to justifying its premium market valuation.

Nvidia's "Alpamayo" Platform Enters the Fray

A key source of recent market volatility stemmed from Nvidia's presentation at CES 2026. The chipmaker's introduction of its "Alpamayo" platform represents a direct challenge to one of Tesla's central long-term narratives: autonomous driving. The platform is designed to offer established automakers a turnkey solution to compete with Tesla's Full Self-Driving (FSD) technology.

Should investors sell immediately? Or is it worth buying Tesla?

Initial investor reaction was nervous, with concerns that Nvidia could erode Tesla's perceived technological moat in the future robotaxi sector. However, shares later stabilized as the market reassessed the immediate threat. Bullish commentators argue that Tesla retains a crucial advantage through its vast fleet of vehicles, which continuously gathers real-world data for neural network training—an edge they believe pure hardware suppliers cannot quickly replicate.

A Chasm in Analyst Perspectives

The underlying uncertainty is reflected in an unusually wide dispersion of analyst price targets. GLJ Research reaffirmed its sell rating, setting a target of just $25.28. Their rationale centers on Tesla's core automotive business, which still generates over 70% of revenue, contracting. This, they argue, renders the current valuation completely detached from fundamental reality.

In stark contrast, New Street Research paints a radically different picture with a $600 price target. Analyst Pierre Ferragu interprets competitive announcements as a validation of Tesla's strategic direction. He believes the company maintains a multi-year lead in autonomous driving and that the ramp-up of its "Cybercab" by late 2026 could propel the stock into new valuation territory. Taking a middle ground, Morningstar advises caution, citing a fair value estimate of $300, which implies significant potential for a downward correction.

All eyes are now on the upcoming earnings report scheduled for January 28, 2026. Investors are anticipating detailed quarterly results, seeking concrete commentary on margins and a reliable timeline for Cybercab production. This information is seen as critical for Tesla to sustainably defend the technically significant price level of $430 per share.