Tesla Inc. (TSLA) is having a moment. Shares raced to all-time highs on Tuesday, with momentum building right into the closing bell. The question everyone's asking: what's fueling this breakout?

From EVs to Robotaxis: The Narrative Shift

Here's the thing about Tesla right now: it's less about the cars and more about what happens when those cars drive themselves. Sure, the company still makes most of its money selling electric vehicles, but Wall Street is looking ahead to 2026 and seeing something entirely different.

CEO Elon Musk dropped some news this week that got investors excited. Tesla began testing its robotaxis in Austin without anyone in the vehicles at all. That's a big step up from June, when the company first rolled out its robotaxi platform using modified Full Self-Driving Model Y vehicles with a human "safety monitor" riding shotgun.

In a post on X over the weekend, Musk confirmed that robotaxis are now being tested with "no occupants in the car." No safety driver. No backup human. Just the car and the software.

The Waymo Effect

The timing is interesting. Traditional ride-hailing companies have been under pressure lately after Alphabet's Waymo announced it's completing 450,000 rides per week and expects to exceed 20 million lifetime trips by the end of the year. That's real scale, and it's making investors think seriously about who wins the autonomous ride-hailing race.

Tesla bulls are betting on the Cybercab launch expected next year. The market is increasingly pricing Tesla shares not as a car company but as a software, robotics, and AI powerhouse with the potential to unlock recurring mobility revenue at serious scale.

Dan Ives Sees a "Monster Year" Ahead

Wedbush analyst Dan Ives, a longtime Tesla bull, said Monday that 2026 is setting up to be a "monster year" for Tesla, pointing to traction in autonomous driving and robotics.

"We believe Tesla hits a $2 trillion market cap in 2026 and in a bull case scenario $3 trillion by end of 2026," Ives wrote in a post on X.

Ives has an Outperform rating on Tesla shares with a Street-high price target of $600. Wall Street analysts have an average price target of $401.29 on Tesla stock with a consensus Buy rating, according to market data.

The Musk Ecosystem Expands

Recent reports suggest Musk's SpaceX could go public next year at a $1.5 trillion valuation. Ives said this week that he believes a potential IPO will only expand the Musk ecosystem for Tesla investors, adding that the AI revolution is likely in the early stages of an eight-to-10-year buildout.

The orbital data center theme is also starting to emerge in markets, with Musk saying in a recent interview that the future will involve a convergence of SpaceX, Tesla, and xAI technology. That's sparked excitement across the Tesla bull community.

In the same interview, Musk revealed that Tesla plans to commence scaled production of its Optimus bots in mid-2026, pushing investor excitement to a fresh peak alongside the stock price.

"I think everyone's gonna want their own personal C-3PO, R2-D2," Musk said.

The Technical Picture

Tesla shares closed Tuesday up 3.07% at $489.88. The stock is currently positioned strongly above its key moving averages, indicating bullish momentum. Tesla is trading 13.7% above its 20-day simple moving average, 12.4% above its 50-day SMA, and a notable 22.6% above its 100-day SMA, which suggests a solid upward trend.