Italian luxury sports car maker Ferrari (NYSE: RACE) is Morgan Stanley’s pick as the firm’s “favorite electric vehicle stock for 2022,” according to a note released by the Autos and Shared Mobility team. Led by analysts Adam Jonas, Morgan Stanley’s team of stock professionals chose Ferrari over other high-powered EV stock favorites, including Rivian and Tesla, both of which are widely considered the most promising and overall leader of the EV industry, respectively.
“Ferrari was listed as “Our new ‘Top Pick’ (replacing GM),” Morgan Stanley wrote in a note to investors released this morning. “Can justify 100% of the company’s market cap with ‘fine-art’ ICE business…leaving [for] the EV business (currently in skunkworks) for free. This makes RACE our favorite EV stock for 2022.” Ferrari was listed ahead of Rivian, which is ranked 2nd on Morgan Stanley’s list, and Tesla, which sits in fourth, behind Freyr, a Norway-based company in the business of manufacturing battery cells with sustainable energy.
US Auto Stock Rankings for FY 22 | Morgan Stanley/Adam Jonas
Ferrari is the new ‘Top Pick’ ?? $RACE$GM$RIVN$TSLA pic.twitter.com/KRcbjahHOb
— David Tayar (@davidtayar5) January 4, 2022
Morgan Stanley’s outlook on Ferrari is interesting, especially as the company has not technically made any formal statement regarding plans to transition to a full lineup of electric cars. The Italian company does have plans to launch its first all-electric model in 2025, company boss John Elkann said in April 2021. Ferrari’s commercial boss, Enrico Galliera, said it would not produce any BEV models until EV tech would allow the company to “produce a car that fits with our position.” Galliera said, “If we bring in new technology, then we need to bring something new to the market. That’s how Ferrari has always worked with new technology. The evolution of new technology is 100% in the DNA of Ferrari.”
The company’s position regarding EVs was only solidified in 2021, as Elkann stated during the Ferrari Q2 Earnings Call that executives welcomed regulations that would restrict the widespread production of gas-powered engines. However, there could be a substantial wait for Ferrari to make a full-fledged shift to EVs, as Elkann added, “… we’ll have changes within the energy supply, which could lead to having alternatives, for example, e-fuels or hydrogen. But that is really 2030, 2040, and most likely midpoint 2035, where we’ll see this happening. What we want to make sure is to be able to use the technologies available, which today are hybrid going to electric and exploiting those to the fullest and in the best way possible.”
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Morgan Stanley placed an “Overweight” rating on Ferrari with a $350 price target. Ferrari shares were trading at $235.10 at the time of writing.
Interestingly, Rivian and Tesla were subsided by Morgan Stanley’s note. Rivian began deliveries of its first EV, the R1T pickup truck, in late October. Morgan Stanley’s note indicates that Rivian (NASDAQ: RIVN) is “The One” for your portfolio, based on “a clean-sheet strategy with deterministic capital (raised ~$25bn) focused on adventure and commercial fleets.” Analysts stated that 2022 will be a tumultuous year for the automaker’s stock as it attempts to ramp manufacturing. Rivian will break ground on its second U.S. facility during Summer 2022. The new plant will be located near Atlanta, Georgia.
Rivian was given an “Overweight” rating with a $147 price target. Shares were trading at $100.65 at the time of writing.
Meanwhile, Tesla (NASDAQ: TSLA) is ranked as the fourth-best EV stock for 2022. “While Tesla is not our top EV pick, it’s arguably our most ‘important’ stock pick. Not owning Tesla means not owning the one company that could make all your other EV names obsolete. A big 4Q delivery beat is just the opening act. Gigapress and structural pack come to life in 2022.”
Tesla will also have Gigafactory Berlin and Gigafactory Texas coming to life this year, which could expand the production output by 1 million units when coupled with potential expansions at Fremont and Gigafactory Shanghai. Tesla came just shy of the 1 million unit mark that many thought the company would reach this year. However, the automaker is still the most valuable car company in the world and is the sole reason for the EV movement in 2022.
Morgan Stanley gave Tesla an “Overweight” rating with a price target of $1,200. Shares were trading at $1,143 at the time of writing.
Disclosure: Joey Klender is a $TSLA Shareholder. He currently does not own any $RACE or $RIVN shares.
I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.
Investor's Corner
NASA taps SpaceX to launch the telescope that could unlock new worlds
NASA’s Roman Space Telescope heads to orbit this August aboard SpaceX’s Falcon Heavy with massive scientific ambitions.
SpaceX is set to play a central role in one of NASA’s most anticipated science missions in years. The company’s Falcon Heavy rocket, currently the most powerful operational launch vehicle in the world, will carry the Nancy Grace Roman Space Telescope into orbit on August 30 from Kennedy Space Center in Florida. Roman is now in final preparations inside the Payload Hazardous Servicing Facility, where on June 26 technicians used a crane to lift the observatory into a specialized stand for fueling and pre-launch testing.
Roman is named after Nancy Grace Roman, NASA’s first chief of astronomy, whose career helped shape how the agency approaches space science.
NASA chose SpaceX Falcon Heavy because of Roman’s needs to reach a specific orbit far from Earth, well beyond where a standard Falcon 9 can deliver it. The Falcon Heavy, which first flew in 2018, has since become NASA’s go-to option for missions that need serious muscle without the cost and complexity of older launch systems.
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Roman will carry a field of view at least 100 times wider than the Hubble Space Telescope, meaning it can photograph enormous swaths of the universe in a single shot rather than the narrow slices Hubble captures. That difference in scale is significant. While Hubble reshaped our understanding of the cosmos over 30 years, Roman is built to work faster and wider, surveying hundreds of millions of galaxies at once.
One of Roman’s most compelling capabilities is its potential to discover and photograph planets orbiting stars outside our solar system, and with enough precision to directly image planets that would otherwise be lost. That means scientists could study the atmosphere and surface characteristics of distant worlds rather than simply confirming they exist. Combined with Roman’s sweeping field of view, the telescope could detect thousands of exoplanets, and some of those planets may be in habitable zones where liquid water could exist. No telescope currently in operation has this level of power and capability. That capability alone could change what we know about other worlds, and perhaps finally answer the question: are we the only intelligent lifeforms in existence?
What Roman actually finds once it reaches orbit is an open question, and that is exactly what makes this launch worth watching.
Elon Musk
California snubs Tesla in its newly passed EV incentive that favors Rivian and Lucid
California passed a $135 million EV incentive that rewards Rivian and Lucid while sidelining Tesla
California just drew a line in the EV incentive sand to put Tesla on the wrong side of it. The state recently passed a $135 million program offering first-time electric vehicle buyers a direct incentive with no application required, but the rules were written in a way that leaves Tesla at a structural disadvantage compared to Rivian and Lucid.
The program caps eligible vehicles at $50,000 for new EVs and $25,000 for used ones. That pricing threshold rules out a significant portion of Tesla’s lineup, though some lower-priced Model 3 and Model Y configurations would still qualify. California-based automakers are exempt from the price cap entirely, regardless of what their vehicles cost. Rivian, headquartered in Irvine, and Lucid, based in the San Francisco Bay Area, both benefit from that exemption. Rivian’s R2 starts at roughly $45,000 but has versions above the cap. Lucid’s Air and Gravity start at $70,990 and $79,990 respectively, well above any threshold a non-California company would face.
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Tesla built its reputation and a significant portion of its early market share in California, where EV adoption has consistently led the nation. The company operates its original factory in Fremont, California, and the state was home to Tesla’s headquarters for most of its existence. That changed in 2021 when Tesla moved its corporate headquarters to Austin, Texas. Since then, the relationship between the company and California Governor Gavin Newsom has been openly adversarial, with Musk and Newsom trading public criticism on multiple occasions.
California’s EV incentive landscape has shifted repeatedly in recent years, and Tesla has previously lost eligibility for state-level programs as its vehicles exceeded income-adjusted price thresholds. The federal $7,500 EV tax credit, which Tesla models have qualified for and lost depending on policy cycles, is no longer available after it expired without renewal, making state-level programs more meaningful to buyers than they have been in years.
The practical impact for buyers is more nuanced than the headline suggests. California residents purchasing a Tesla under $50,000 for the first time can still access the incentive. But the exemption written for California-based manufacturers is a structural advantage that rewards where a company plants its headquarters flag rather than where it builds its products, and Tesla moved that flag to Texas.
Elon Musk
SpaceX’s newest logo confirms everything about what it’s become
SpaceX officially absorbed xAI under the SpaceXAI brand, completing the largest private merger in history.
SpaceX made its corporate transformation official in May 2026 when Elon Musk posted on X that xAI would cease to exist as a standalone company. “xAI will be dissolved as a separate company, so it will just be SpaceXAI, the AI products from SpaceX,” he wrote.
A new SpaceXAI logo was announced today, visually embedding the xAI letters inside the SpaceX identity, which can be seen as a deliberate design choice that signals the merger is not a partnership but a full absorption and XAi a core function of the same company. The same way Starlink is not a separate brand but a SpaceX product. The announcement closed the loop on a process that began February 2, 2026, when SpaceX acquired xAI in the largest private merger in history, valued at $1.25 trillion. SpaceX at $1 trillion and xAI at $250 billion.
We are now @SpaceXAI. pic.twitter.com/ema66xDWC9
— SpaceXAI (@SpaceXAI) July 6, 2026
The reason SpaceX bought xAI was stated plainly by Musk at the time of the deal: to build orbital data centers. SpaceX had simultaneously filed with the FCC to launch up to one million satellites designed to function as AI compute nodes in low Earth orbit, escaping what Musk described as the energy constraints limiting AI development on Earth.
xAI provided the AI software stack, with Grok, the X platform, and the Colossus supercomputer infrastructure in Memphis with over 220,000 NVIDIA GPUs, while SpaceX provided the rockets, Starlink, and the capital base to fund it. The two companies needed each other. xAI was burning $2.5 billion in losses on $250 million in revenue. SpaceX was generating an estimated $8 billion in profit on $15 billion in revenue and needed an AI narrative to command the valuation it was targeting for its IPO.
What SpaceX has done, regardless of how the orbital AI vision ultimately plays out, is walk into a public market as something no company has been before: a rocket manufacturer, satellite internet provider, AI software company, social media platform, and supercomputer operator under one ticker. Whether that combination is worth $2 trillion depends entirely on which of those businesses you believe in most.