Investor's Corner
Tesla’s (TSLA) growth gets it two new price targets from Morgan Stanley
Tesla (NASDAQ: TSLA) has received a new raised price target of $1,050 with an Underweight rating from Wall Street firm Morgan Stanley. The electric automaker also has received a revised bull case price target of $2,500 from the investment firm.
Morgan Stanley’s Adam Jonas gave Tesla the increased price target based on a combination of the electric automaker’s growth, its forecast until the year 2030, and the recent release of the Q2 Earnings Call results. Tesla’s Q2 results were announced on Wednesday, July 22.
“It’s becoming increasingly obvious that Tesla is going to become a very large company,” Jonas wrote in a note to investors. “For the first time during our 10 years of coverage, we’re starting to model this company as a very, very large automaker.”
Jonas’ last price target for Tesla was $740, and his previous bull case PT was $2,070.
* TESLA PT RAISED TO $1,050 BY MORGAN STANLEY; BULL CASE RAISED TO $2,500
🤯🤯$TSLA pic.twitter.com/4Fej1bSocq
— David Tayar (@davidtayar5) July 29, 2020
Jonas believes that Tesla could approach and exceed Toyota and Volkswagen’s revenues during the next ten years. Morgan Stanley’s forecasted models that project Tesla’s growth until 2030 indicate that the electric automaker could see around $170 billion of revenues.
If Tesla can make this estimation a reality, it could become “a substantially larger company by revenue than Ford or GM.”
Tesla’s surge in stock price over the past few months has made it the most valuable automaker in the world, surpassing Volkswagen and Toyota. Both companies hold massive valuations based on their worldwide market and popularity.
However, Tesla is beginning to surge into global superstardom as an automaker. The company’s reign as the supreme mass-market automaker started in 2017 when the company unleashed the Tesla Model 3, an affordable sedan with multiple variants that would fit any driver’s range or performance preferences.
Since then, the company has worked to expand its fleet of affordable vehicles, while also offering an array of new styles and body types that will fit the lifestyle or occupation of nearly anyone on Earth.
Jonas stated in his letter to investors that the company’s Q2 results, along with the company’s expanding vehicle fleet, influenced the analyst to restructure Tesla’s revenue model.
“We have restructured our revenue model to include greater model granularity (Cybertruck, Semi, Multipurpose Van, etc.), raising our 2030 volume forecast to 3 million. Our forecasts give Tesla credit for nearly an additional three full factories of production, which we can see as reasonable give the company’s demonstrated strategy of rapid capacity expansion,” he said.
By 2030, Tesla will have at least four production facilities that will be churning out the company’s electric vehicles. The company’s main production facility is located in Fremont, California. However, Tesla’s Giga Shanghai plant is currently manufacturing the Made in China Model 3 and will soon expand to Model Y production.
Additionally, Tesla has two manufacturing plants that are under construction. In Germany, Giga Berlin will be completed in July 2021 and will begin manufacturing the Model Y for the vast European market.
During the Q2 call, CEO Elon Musk indicated that the company had already started construction at its newest U.S.-located production plant, which is located just outside of Austin, Texas.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
H/t: @DavidTayar5 on Twitter
Investor's Corner
Tesla analyst maintains $500 PT, says FSD drives better than humans now
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Tesla (NASDAQ:TSLA) received fresh support from Piper Sandler this week after analysts toured the Fremont Factory and tested the company’s latest Full Self-Driving software. The firm reaffirmed its $500 price target, stating that FSD V14 delivered a notably smooth robotaxi demonstration and may already perform at levels comparable to, if not better than, average human drivers.
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Analysts highlight autonomy progress
During more than 75 minutes of focused discussions, analysts reportedly focused on FSD v14’s updates. Piper Sandler’s team pointed to meaningful strides in perception, object handling, and overall ride smoothness during the robotaxi demo.
The visit also included discussions on updates to Tesla’s in-house chip initiatives, its Optimus program, and the growth of the company’s battery storage business. Analysts noted that Tesla continues refining cost structures and capital expenditure expectations, which are key elements in future margin recovery, as noted in a Yahoo Finance report.
Analyst Alexander Potter noted that “we think FSD is a truly impressive product that is (probably) already better at driving than the average American.” This conclusion was strengthened by what he described as a “flawless robotaxi ride to the hotel.”
Street targets diverge on TSLA
While Piper Sandler stands by its $500 target, it is not the highest estimate on the Street. Wedbush, for one, has a $600 per share price target for TSLA stock.
Other institutions have also weighed in on TSLA stock as of late. HSBC reiterated a Reduce rating with a $131 target, citing a gap between earnings fundamentals and the company’s market value. By contrast, TD Cowen maintained a Buy rating and a $509 target, pointing to strong autonomous driving demonstrations in Austin and the pace of software-driven improvements.
Stifel analysts also lifted their price target for Tesla to $508 per share over the company’s ongoing robotaxi and FSD programs.
Investor's Corner
Tesla wins $508 price target from Stifel as Robotaxi rollout gains speed
The firm cited meaningful progress in Tesla’s robotaxi roadmap, ongoing Full Self-Driving enhancements, and the company’s long-term growth initiatives.
Tesla received another round of bullish analyst updates this week, led by Stifel, raising its price target to $508 from $483 while reaffirming a “Buy” rating. The firm cited meaningful progress in Tesla’s robotaxi roadmap, ongoing Full Self-Driving enhancements, and the company’s long-term growth initiatives.
Robotaxi rollout, FSD updates, and new affordable cars
Stifel expects Tesla’s robotaxi fleet to expand into 8–10 major metropolitan areas by the end of 2025, including Austin, where early deployments without safety drivers are targeted before year-end. Additional markets under evaluation include Nevada, Florida, and Arizona, as noted in an Investing.com report. The firm also highlighted strong early performance for FSD Version 14, with upcoming releases adding new “reasoning capabilities” designed to improve complex decision-making using full 360-degree vision.
Tesla has also taken steps to offset the loss of U.S. EV tax credits by launching the Model Y Standard and Model 3 Standard at $39,990 and $36,990, Stifel noted. Both vehicles deliver more than 300 miles of range and are positioned to sustain demand despite shifting incentives. Stifel raised its EBITDA forecasts to $14.9 billion for 2025 and $19.5 billion for 2026, assigning partial valuation weightings to Tesla’s FSD, robotaxi, and Optimus initiatives.
TD Cowen also places an optimistic price target
TD Cowen reiterated its Buy rating with a $509 price target after a research tour of Giga Texas, citing production scale and operational execution as key strengths. The firm posted its optimistic price target following a recent Mobility Bus tour in Austin. The tour included a visit to Giga Texas, which offered fresh insights into the company’s operations and prospects.
Additional analyst movements include Truist Securities maintaining its Hold rating following shareholder approval of Elon Musk’s compensation plan, viewing the vote as reducing leadership uncertainty.
@teslarati Tesla Full Self-Driving yields for pedestrians while human drivers do not…the future is here! #tesla #teslafsd #fullselfdriving ♬ 2 Little 2 Late – Levi & Mario
Investor's Corner
Tesla receives major institutional boost with Nomura’s rising stake
The move makes Tesla Nomura’s 10th-largest holding at about 1% of its entire portfolio.
Tesla (NASDAQ:TSLA) has gained fresh institutional support, with Nomura Asset Management expanding its position in the automaker.
Nomura boosted its Tesla holdings by 4.2%, adding 47,674 shares and bringing its total position to more than 1.17 million shares valued at roughly $373.6 million. The move makes Tesla Nomura’s 10th-largest holding at about 1% of its entire portfolio.
Institutional investors and TSLA
Nomura’s filing was released alongside several other fund updates. Brighton Jones LLC boosted its holdings by 11.8%, as noted in a MarketBeat report, and Revolve Wealth Partners lifted its TSLA position by 21.2%. Bison Wealth increased its Tesla stake by 52.2%, AMG National Trust Bank increased its position in shares of Tesla by 11.8%, and FAS Wealth Partners increased its TSLA holdings by 22.1%. About 66% of all outstanding Tesla shares are now owned by institutional investors.
The buying comes shortly after Tesla reported better-than-expected quarterly earnings, posting $0.50 per share compared with the $0.48 consensus. Revenue reached $28.10 billion, topping Wall Street’s $24.98 billion estimate. Despite the earnings beat, Tesla continues to trade at a steep premium relative to peers, with a market cap hovering around $1.34 trillion and a price-to-earnings ratio near 270.
Recent insider sales
Some Tesla insiders have sold stock as of late. CFO Vaibhav Taneja sold 2,606 shares in early September for just over $918,000, reducing his personal stake by about 21%. Director James R. Murdoch executed a far larger sale, offloading 120,000 shares for roughly $42 million and trimming his holdings by nearly 15%. Over the past three months, Tesla insiders have collectively sold 202,606 shares valued at approximately $75.6 million, as per SEC disclosures.
Tesla is currently entering its next phase of growth, and if it is successful, it could very well become the world’s most valuable company as a result. The company has several high-profile projects expected to be rolled out in the coming years, including Optimus, the humanoid robot, and the Cybercab, an autonomous two-seater with the potential to change the face of roads across the globe.
@teslarati Tesla Full Self-Driving yields for pedestrians while human drivers do not…the future is here! #tesla #teslafsd #fullselfdriving ♬ 2 Little 2 Late – Levi & Mario
SpaceX issues statement on Starship V3 Booster 18 anomaly
Tesla analyst maintains $500 PT, says FSD drives better than humans now
