Is Tesla-SpaceX tie-up becoming more than just speculation?

Jefferies warns Tesla’s upcoming Q1 results may widen the gap between its robotaxi ambitions and near-term execution, potentially keeping merger talk with SpaceX alive. The bank kept a Hold rating but raised its price target to $350 from $300, citing weak near-term profitability: Q1 revenue is forecast at $21.2 billion (up ~10% YoY) with an operating margin below 3% and roughly $1.9 billion cash burn. Jefferies expects 2026 negative free cash flow near $5.5 billion as capex ramps to $19–20 billion annually and models no robotaxi revenue until 2027. While noting Tesla’s unique vertical scale and funding ability, the note underscores execution risks that could sustain sentiment-driven share moves and merger speculation. Market impact: the stock remains sensitive to execution milestones and investor faith rather than traditional valuation metrics.