Tesla rose 9.4% on Monday after Morgan Stanley said its Dojo supercomputer could create a $600 billion increase in the electric car maker’s market value by accelerating it into robotaxis and software services. .
Tesla, the world’s most valuable automaker, began building the supercomputer to train artificial intelligence models for self-driving cars in July, and plans to invest more than $1 billion in Dojo through next year .
Dojo can open new markets “beyond selling cars at a certain price,” said Morgan Stanley analysts led by Alex Jonas.
If Dojo can help cars see and react, what other markets might open up? “Imagine any cutting-edge device with a camera that makes real-time decisions based on your field of view.”
The investment bank upgraded its recommendation for Tesla shares to “overweight” from “hold,” and replaced Tesla’s US-listed Ferrari shares as a “favorite pick.”
So Morgan Stanley raised its 12-18 month target for Tesla shares by 60%, up to $400, the highest among Wall Street agencies, according to LSEG data. That would give the automaker a value of $1.39 trillion. This figure is 76% higher than Tesla’s market value, about 789 billion, according to Friday’s closing, at $248.5 per share.
The bank raised its revenue estimate for Tesla’s grid services business to $335 billion by 2040, up from $157 billion previously. Analysts expect the unit to account for more than 60% of Tesla’s revenue by 2040, almost double what it was in 2030. “This growth will be fueled by many of the emerging opportunities we see to license vessels to third parties,” he said. analyst.
Tesla’s trailing 12-month price-to-earnings ratio of 57.9 is better than Ford (6.31) and General Motors (4.56), according to LSEG data.