It’s a battle to the end for two world-famous companies. Tesla (NASDAQ:TSLA) stock and Meta Platforms (NASDAQ:META) stock are both running on all cylinders, but which one will be the winner over the next 12 months? I am bullish on both TSLA stock and META stock, but today I’m going to let some of Wall Street’s foremost experts help me pick a champion among the two Nasdaq (NDX) titans.
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Chances are, you’re already familiar with electric vehicle (EV) manufacturer Tesla as well as social media and metaverse company Meta Platforms. These two gigantic businesses are run by their well-known CEOs, Elon Musk of Tesla and Mark Zuckerberg of Meta.
Surely, it would be a thrill to witness a face-to-face battle between these two brash entrepreneurs. Indeed, TMZ recently reported that an official from Italy’s government contacted Zuckerberg about staging a mixed martial arts fight in the nation’s Coliseum.
I wouldn’t hold your breath waiting for that match to happen, but we can still compare and contrast the two stocks to decide which one will likely have greater momentum over the next year.
Tesla: Lower Prices Translate to Higher Sales
Today, the standout star on Wall Street is undeniably Tesla. The automaker took a big chance when it implemented a series of vehicle price cuts earlier this year (above and beyond the $7,500 EV tax credits available under the Inflation Reduction Act). So, is Musk’s bold strategy translating to robust sales? The answer is definitely yes, and Tesla’s got the data to prove it.
For the second quarter ending June 30, 2023, Tesla delivered 466,140 vehicles, up 83% year-over-year and 10% higher quarter-over-quarter. Here’s where the rubber really meets the road, though. Tesla produced 479,700 vehicles during the quarter, so the automaker delivered nearly as many EVs as it manufactured.
Deutsche Bank (NYSE:DB) analyst Emmanuel Rosner had previously called for Tesla to deliver 448,000 vehicles in Q2, while the consensus estimate was for 445,000 deliveries. Thus, it’s fair to say that Tesla knocked it out of the park, and Musk’s price-reduction strategy seems to be paying off. Now, we can all mark our calendars and get ready for Tesla’s upcoming second-quarter earnings release, which is scheduled for July 24, 2023.
Meta Platforms: It’s Not Just About the Layoffs
It’s no secret that Zuckerberg let go of some of Meta Platforms’ employees in a cost-cutting effort this year. Without a doubt, this has helped to boost investor sentiment surrounding META stock, which has gone on a tear since November of last year.
Yet, there’s more to the bull case for META stock than just layoffs and cost-cutting. There’s also Zuckerberg’s focus on the Metaverse, as Meta Platforms’ surprisingly affordable Quest line of virtual reality (VR) headsets could prove to be game-changers in the coming months.
Plus, let’s not dismiss Meta Platforms’ integration of generative artificial intelligence (AI) into its Facebook, Instagram, and Reels apps (Reels is a short-form video-sharing platform that’s similar to TikTok). Speaking of Reels, Citigroup (NYSE:C) analyst Ronald Josey specifically cited Reels when he raised his price target on META stock from $315 to $360.
Josey’s definitely feeling Reels, as he observes that the platform is “experiencing greater advertiser adoption given its Lo-Fi approach to ads, newer ad products, and continued engagement growth.” Moreover, circling back to machine learning, Josey expects that Meta Platform’s investments in AI “can deliver incremental usage across its users, creators, and advertisers.”
TSLA Stock vs. META Stock: Which One are Analysts Betting on Now?
In case you haven’t figured it out by now, there’s a compelling bull case for both Tesla and Meta Platforms. As often happens in head-to-head match-ups, it’s too close to declare a winner yet, so we’ll let the analysts’ consensus calls be the tie-breaker today.
First, we’ll start with Elon’s company. Surprisingly, Wall Street isn’t super-enthusiastic about Tesla at the moment. According to TipRanks, TSLA comes in as a Moderate Buy based on 14 Buys, 12 Holds, and five Sell ratings. Further, the average Tesla stock price target is $219.96, implying 20.8% downside potential.
If you’re wondering which analyst you should follow if you want to buy and sell TSLA stock, the most accurate analyst covering the stock (on a one-year timeframe) is Mark Delaney of Goldman Sachs (NYSE:GS), with an average return of 18.67% per rating and a 74% success rate. Click on the image below to learn more.
Now, we’ll see how Zuckerberg’s company stacks up. META stock has a Strong Buy rating based on 36 Buys and four Hold ratings, with no Sell ratings whatsoever. Additionally, the average Meta Platforms stock price target is $295.53, implying 3.3% upside potential. Clearly, Zuck delivered a fatal blow to Elon in this category.
Regarding the most accurate analyst covering META stock (on a one-year timeframe), it’s five-star-rated Shebly Seyrafi of FBN Securities, with an average return of 25.75% per rating and a 95% success rate. Click on the image below to learn more.
Conclusion: Should You Consider TSLA Stock or META Stock?
So, is the winner of today’s brutal cage match Tesla stock or Meta Platforms stock? Personally, I’m bullish on both. That said, I must hand the championship belt to Mark Zuckerberg and Meta Platforms today because the company is effectively deploying AI and because analysts generally favor META stock over TSLA stock over the next 12 months.
This story’s far from over, though, so stay tuned for more rough-and-tumble stock battles as the world’s most influential publicly-listed companies vie for the title of Wall Street’s heavyweight champion.
