3 reasons why Tesla stock (TSLA) could be a 'buy' ahead of Q4 earnings

Tesla stock (NASDAQ: TSLA) faces a crucial test on January 28, when the company reports fourth-quarter earnings and provides forward guidance that could reshape 2026 expectations.

Despite recent delivery weakness that has pressured the stock, contrarian investors may find a compelling value entry point in shares that are trading well below consensus price targets.

​Let's see three reasons why Tesla stock can be a good buy ahead of the Q4 earnings:

Margin resilience and energy upside potential

Tesla reported record energy storage deployments of 14.2 gigawatt-hours in Q4 2025, the highest quarterly figure in company history, which could be a bright spot when the company reports full financials on January 28.

While vehicle deliveries fell 16% year-over-year to 418,227 units, the company's energy business is growing at triple-digit rates and could offset near-term automotive margin pressure.

Additionally, Full Self-Driving adoption and premium connectivity subscriptions represent high-margin software revenue streams that aren't fully captured in reported vehicle numbers.

Wall Street estimates suggest FSD software revenue could climb to $2 billion or more in Q4 if take-rates continue accelerating.

The counterpoint is that monetization of autonomy remains nascent and dependent on regulatory approval that hasn't yet materialised at scale.​

Q4 deliveries already priced for weakness

Tesla delivered 418,227 vehicles in Q4, slightly below the company-compiled consensus estimate of 422,850 and well below the Bloomberg estimate of 440,907.

Yet analyst reaction has shifted toward viewing the miss as "better than feared."

The stock's harsh reaction to the delivery report in early January may have already priced in much of the downside, particularly as Wall Street's consensus price target of approximately $408 suggests limited additional downside.

If Tesla's Q4 gross margin or average selling price (ASP) comes in stronger than the low bar set by recent forecasts, or if management provides optimistic 2026 guidance tied to robotaxi deployments, the stock could easily re-rate 5 to 10% higher.

Wedbush analyst Daniel Ives described Q4 results as positioning Tesla to "enter 2026 in a strong position," noting energy strength as a key tailwind.​

Policy support and tax-credit headwind abatement

The federal EV tax credit expired on September 30, 2025, a move that depressed Q4 demand in the United States and weighed heavily on volumes across the industry.

However, state-level rebate programs, particularly California's emerging incentive proposals, could partially offset this headwind.

Additionally, under Trump's administration, regulatory pathways for Full Self-Driving approval may accelerate, which Wedbush estimates could unlock robotaxi deployments in more than 30 US cities in 2026.​

Tesla stock: What analysts say

Wall Street opinion remains mixed.

The consensus rating is "Hold" with 13 analysts rating Tesla a "Buy," 11 rating it a "Hold," and seven rating it a "Sell."

Wedbush maintains an "Outperform" rating with a $600 price target, implying 36% upside if robotaxi monetization accelerates.

Conversely, UBS maintains a "Sell" rating at $247, arguing that the stock prices are giving too much autonomy optionality too soon.​

Tesla presents a high-risk, high-reward setup ahead of Q4 earnings.

Bullish outcomes hinge on margin resilience, services, and energy revenue outperformance, and clear 2026 guidance tied to autonomy and robotics scaling.

Downside remains significant if guidance disappoints or volume trends deteriorate further.