Investor's Corner
Tesla’s (TSLA) Battery Day is charging Jim Cramer’s valuation: “It’s Game, Set, Match”
Tesla (NASDAQ: TSLA) fan and former critic of the company Jim Cramer is looking forward to Battery Day on September 22, and it is fueling his valuation of the automaker who he once considered to be a guaranteed “sell” in the stock market.
An interview with Tesla Daily and TheStreet’s Rob Maurer allowed Cramer to clear the air about his thoughts for the electric car maker. However, looking forward, Cramer is excited for the company’s upcoming Battery Day, because he feels that it could be a key to spiking Tesla’s valuation into the stratosphere.
“What’s key to my valuation, Rob, is what Elon Musk will say on September 22,” Cramer said. Expecting Tesla to roll out a battery cell that could run for ten or twelve hours because of solar energy, Cramer admits he is not familiar with what Musk will unveil during the event. Any way Tesla puts it, Cramer believes it is “Game, Set, Match” for the automotive industry.
Maurer explained the more popular beliefs of Battery Day to Cramer, stating that Tesla will outline its battery strategy for the world to feast on. Additionally, Tesla could explain how it intends to increase annual battery production across all of its products, and not just its cars.
Maurer, like any Tesla enthusiast, knows that a lot of hype surrounds Battery Day. Nobody truly knows what will occur in late September or what the expectations are, but one thing is for sure, Wall Street will have its eyes set in Fremont, where the event is taking place.
“I think one thing that investors need to try to understand is really what those expectations are from the broad Wall Street community. Whether they’re expecting some huge technological breakthrough, or whether they’re going to be satisfied with, ‘Okay, here’s our plan to rapidly, capitally efficiently ramp up to a couple of Terawatt hours of battery production.’ I think there is going to be a lot of technological focus, but I think a lot of it is going to be on that capital efficiency and production ramping angle,” Maurer stated.
Ultimately, Tesla wants to increase the longevity of its battery packs, so its vehicles are capable of lasting fifteen or twenty years without having to undergo cell replacements. With that, the company also wants to improve the energy density that its cells can handle, which will lead to increased range within its vehicles.
Cramer, while a Tesla fan, is still an investor, and he believes that his valuation of the company ultimately comes down to what happens on September 22. If Tesla unveils a significant development in terms of its battery goals, the stock will go up. However, he’s advising some investors to proceed with caution, just in case.
“It [Battery Day] may be one of those events where, if you don’t own it, you may want to wait until after, if he doesn’t deliver along the line that people want him to deliver,” Cramer said. “I mean, one of the things I like about Elon Musk is that he’s not thinking about what you want, like Steve Jobs. He’s thinking about what you will want well ahead of when you know it. So he may be over the heads of people on September 22, and that means some people may be disappointed because they didn’t get what they want, not realizing they’re getting twice what they want if they would just shut up and listen.”
This fact leads Cramer to believe that the stock will go higher after Battery Day. Like many people, Battery Day is among Tesla’s most anticipated events in the company’s history because it is more significant than cars and energy storage; it is the future of our planet.
The full interview between Rob Maurer and Jim Cramer is available below.
Elon Musk
Tesla locks in Elon Musk’s top problem solver as it enters its most ambitious era
The generous equity award was disclosed by the electric vehicle maker in a recent regulatory filing.
Tesla has granted Senior Vice President of Automotive Tom Zhu more than 520,000 stock options, tying a significant portion of his compensation to the company’s long-term performance.
The generous equity award was disclosed by the electric vehicle maker in a recent regulatory filing.
Tesla secures top talent
According to a Form 4 filing with the U.S. Securities and Exchange Commission, Tom Zhu received 520,021 stock options with an exercise price of $435.80 per share. Since the award will not fully vest until March 5, 2031, Zhu must remain at Tesla for more than five years to realize the award’s full benefit.
Considering that Tesla shares are currently trading at around the $445 to $450 per share level, Zhu will really only see gains in his equity award if Tesla’s stock price sees a notable rise over the years, as noted in a Sina Finance report.
Still, even at today’s prices, Zhu’s stock award is already worth over $230 million. If Tesla reaches the market cap targets set forth in Elon Musk’s 2025 CEO Performance Award, Zhu would become a billionaire from this equity award alone.
Tesla’s problem solver
Zhu joined Tesla in April 2014 and initially led the company’s Supercharger rollout in China. Later that year, he assumed the leadership of Tesla’s China business, where he played a central role in Tesla’s localization efforts, including expanding retail and service networks, and later, overseeing the development of Gigafactory Shanghai.
Zhu’s efforts helped transform China into one of Tesla’s most important markets and production hubs. In 2023, Tesla promoted Zhu to Senior Vice President of Automotive, placing him among the company’s core global executives and expanding his influence beyond China. He has since garnered a reputation as the company’s problem solver, being tapped by Elon Musk to help ramp Giga Texas’s vehicle production.
With this in mind, Tesla’s recent filing seems to suggest that the company is locking in its top talent as it enters its newest, most ambitious era to date. As could be seen in the targets of Elon Musk’s 2025 pay package, Tesla is now aiming to be the world’s largest company by market cap, and it is aiming to achieve production levels that are unheard of. Zhu’s talents would definitely be of use in this stage of the company’s growth.
Tesla analyst Andrew Percoco of Morgan Stanley teased the company’s dominance in its self-driving initiative, stating that its lead over competitors is “not even close.”
Percoco recently overtook coverage of Tesla stock from Adam Jonas, who had covered the company at Morgan Stanley for years. Percoco is handling Tesla now that Jonas is covering embodied AI stocks and no longer automotive.
His first move after grabbing coverage was to adjust the price target from $410 to $425, as well as the rating from ‘Overweight’ to ‘Equal Weight.’
Percoco’s new note regarding Tesla highlights the company’s extensive lead in self-driving and autonomy projects, something that it has plenty of competition in, but has established its prowess over the past few years.
He writes:
“It’s not even close. Tesla continues to lead in autonomous driving, even as Nvidia rolls out new technology aimed at helping other automakers build driverless systems.”
Percoco’s main point regarding Tesla’s advantage is the company’s ability to collect large amounts of training data through its massive fleet, as millions of cars are driving throughout the world and gathering millions of miles of vehicle behavior on the road.
This is the main point that Percoco makes regarding Tesla’s lead in the entire autonomy sector: data is King, and Tesla has the most of it.
One big story that has hit the news over the past week is that of NVIDIA and its own self-driving suite, called Alpamayo. NVIDIA launched this open-source AI program last week, but it differs from Tesla’s in a significant fashion, especially from a hardware perspective, as it plans to use a combination of LiDAR, Radar, and Vision (Cameras) to operate.
Percoco said that NVIDIA’s announcement does not impact Morgan Stanley’s long-term opinions on Tesla and its strength or prowess in self-driving.
NVIDIA CEO Jensen Huang commends Tesla’s Elon Musk for early belief
And, for what it’s worth, NVIDIA CEO Jensen Huang even said some remarkable things about Tesla following the launch of Alpamayo:
“I think the Tesla stack is the most advanced autonomous vehicle stack in the world. I’m fairly certain they were already using end-to-end AI. Whether their AI did reasoning or not is somewhat secondary to that first part.”
Percoco reiterated both the $425 price target and the ‘Equal Weight’ rating on Tesla shares.
Tesla stock (NASDAQ: TSLA) just got a price target boost from its biggest bear, Gordon Johnson of GLJ Research, who raised his expected trading level to one that is 95 percent lower than its current trading level.
Johnson pushed his Tesla price target from $19.05 to $25.28 on Wednesday, while maintaining the ‘Sell’ rating that has been present on the stock for a long time. GLJ has largely been recognized as the biggest skeptic of Elon Musk’s company, being particularly critical of the automotive side of things.
Tesla has routinely been called out by Johnson for negative delivery growth, what he calls “weakening demand,” and price cuts that have occurred in past years, all pointing to them as desperate measures to sell its cars.
Johnson has also said that Tesla is extremely overvalued and is too reliant on regulatory credits for profitability. Other analysts on the bullish side recognize Tesla as a company that is bigger than just its automotive side.
Many believe it is a leader in autonomous driving, like Dan Ives of Wedbush, who believes Tesla will have a widely successful 2026, especially if it can come through on its targets and schedules for Robotaxi and Cybercab.
Justifying the price target this week, Johnson said that the revised valuation is based on “reality rather than narrative.” Tesla has been noted by other analysts and financial experts as a stock that trades on narrative, something Johnson obviously disagrees with.
Dan Nathan, a notorious skeptic of the stock, turned bullish late last year, recognizing the company’s shares trade on “technicals and sentiment.” He said, “From a trading perspective, it looks very interesting.”
Tesla bear turns bullish for two reasons as stock continues boost
Johnson has remained very consistent with this sentiment regarding Tesla and his beliefs regarding its true valuation, and has never shied away from putting his true thoughts out there.
Tesla shares closed at $431.40 today, about 95 percent above where Johnson’s new price target lies.
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