Morgan Stanley Backs Tesla's AI and Robotics Efforts, Reinstating It as Top U.S. Auto Pick

Tesla rises 2% as Morgan Stanley backs AI, robotics efforts with 'top pick' status

(Reuters) - Tesla shares rose 2% on Monday after Morgan Stanley reinstated the electric-vehicle maker as its top U.S. auto pick, saying the company's artificial intelligence and robotics efforts could power growth even as the mainstay car business stumbles. The note dated Sunday was the latest from analyst Adam Jonas, a longtime Tesla bull who has praised the company's push beyond autos as sales face pressure from high U.S. borrowing costs and fierce Chinese competition including from BYD. Industry data showed Tesla sales fell 45% in Europe in January while overall EV sales jumped 37% in the region. Jonas said recent setbacks, including Tesla's first annual deliveries drop in 2024, signaled its shift from an "automotive pure play to a highly diversified play on AI and robotics." He reaffirmed his $430 price target, one of Wall Street's highest, which implies a 44% upside to the stock's last trade. The remarks echoed Tesla CEO Elon Musk, who has pivoted the automaker to robotaxis and AI in the past year, even as experts argue that large-scale adoption of the vehicles could be years away due to regulatory hurdles and technological limitations. Jonas is no stranger to bold Tesla predictions. In September 2023, he said Tesla's Dojo supercomputer could boost its market value by nearly $600 billion through advancements in robotaxis. Since then, Tesla's market value has risen by about $150 billion to nearly $950 billion. But its shares have trailed the broader U.S. market this year, declining 27% as early euphoria over Donald Trump's election win waned, giving way to concerns about weakening sales and CEO Elon Musk's White House engagements. While Musk has promised sales growth this year with the launch of cheaper models, Jonas said deliveries could decline in 2025, providing an "attractive entry point." In October, Tesla showcased its robotaxi, while Musk touted progress on its humanoid robot "Optimus," which could eventually be priced at $20,000 to $30,000. Musk has said Tesla will roll out driverless ride-hailing services in California and Texas this year but provided no further details. (Reporting by Kanchana Chakravarty in Bengaluru; Editing by Tasim Zahid)

Tesla rises 2% as Morgan Stanley backs AI, robotics efforts with 'top pick' status

March 3 (Reuters) - Tesla shares rose 2% on Monday after Morgan Stanley reinstated the electric-vehicle maker as its top U.S. auto pick, saying the company's artificial intelligence and robotics efforts could power growth even as the mainstay car business stumbles. The note dated Sunday was the latest from analyst Adam Jonas, a longtime Tesla (TSLA.O), opens new tab bull who has praised the company's push beyond autos as sales face pressure from high U.S. borrowing costs and fierce Chinese competition including from BYD (002594.SZ), opens new tab. Industry data showed Tesla sales fell 45% in Europe in January while overall EV sales jumped 37% in the region. Jonas said recent setbacks, including Tesla's first annual deliveries drop in 2024, signaled its shift from an "automotive pure play to a highly diversified play on AI and robotics." He reaffirmed his $430 price target, one of Wall Street's highest, which implies a 44% upside to the stock's last trade. The remarks echoed Tesla CEO Elon Musk, who has pivoted the automaker to robotaxis and AI in the past year, even as experts argue that large-scale adoption of the vehicles could be years away due to regulatory hurdles and technological limitations. Jonas is no stranger to bold Tesla predictions. In September 2023, he said Tesla's Dojo supercomputer could boost its market value by nearly $600 billion through advancements in robotaxis. Since then, Tesla's market value has risen by about $150 billion to nearly $950 billion. But its shares have trailed the broader U.S. market this year, declining 27% as early euphoria over Donald Trump's election win waned, giving way to concerns about weakening sales and CEO Elon Musk's White House engagements. While Musk has promised sales growth this year with the launch of cheaper models, Jonas said deliveries could decline in 2025, providing an "attractive entry point." In October, Tesla showcased its robotaxi, while Musk touted progress on its humanoid robot "Optimus," which could eventually be priced at $20,000 to $30,000. Musk has said Tesla will roll out driverless ride-hailing services in California and Texas this year but provided no further details. Reporting by Kanchana Chakravarty in Bengaluru; Editing by Tasim Zahid Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial IntelligenceADAS, AV & SafetySustainable & EV Supply ChainRetail

Tesla shares rise 2% as Morgan Stanley backs AI, robotics efforts with 'top pick' status

Tesla shares rose by 2% after Morgan Stanley reinstated it as its top U.S. auto pick, citing AI and robotics efforts despite a 45% drop in European sales. Analyst Adam Jonas reaffirmed a $430 price target, noting the company's shift from an automotive focus to AI and robotics, echoing CEO Elon Musk's pivot towards robotaxis and AI. Tesla shares rose 2% on Monday after Morgan Stanley reinstated the electric-vehicle maker as its top U.S. auto pick, saying the company's artificial intelligence and robotics efforts could power growth even as the mainstay car business stumbles. The note dated Sunday was the latest from analyst Adam Jonas, a longtime Tesla bull who has praised the company's push beyond autos as sales face pressure from high U.S. borrowing costs and fierce Chinese competition including from BYD. Industry data showed Tesla sales fell 45% in Europe in January while overall EV sales jumped 37% in the region. Jonas said recent setbacks, including Tesla's first annual deliveries drop in 2024, signaled its shift from an "automotive pure play to a highly diversified play on AI and robotics." He reaffirmed his $430 price target, one of Wall Street's highest, which implies a 44% upside to the stock's last trade. The remarks echoed Tesla CEO Elon Musk, who has pivoted the automaker to robotaxis and AI in the past year, even as experts argue that large-scale adoption of the vehicles could be years away due to regulatory hurdles and technological limitations. Jonas is no stranger to bold Tesla predictions. In September 2023, he said Tesla's Dojo supercomputer could boost its market value by nearly $600 billion through advancements in robotaxis. Since then, Tesla's market value has risen by about $150 billion to nearly $950 billion. But its shares have trailed the broader U.S. market this year, declining 27% as early euphoria over Donald Trump's election win waned, giving way to concerns about weakening sales and CEO Elon Musk's White House engagements. While Musk has promised sales growth this year with the launch of cheaper models, Jonas said deliveries could decline in 2025, providing an "attractive entry point." In October, Tesla showcased its robotaxi, while Musk touted progress on its humanoid robot "Optimus," which could eventually be priced at $20,000 to $30,000. Musk has said Tesla will roll out driverless ride-hailing services in California and Texas this year but provided no further details.

Top Analyst Forecasts Over 50% Surge in Tesla Stock Amid AI & Robotics Push: 'Humanoid Robot Serious Enough To Move The Stock' - Tesla (NASDAQ:TSLA)

Morgan Stanley has reinstated Elon Musk's Tesla Inc. TSLA as its top U.S. auto pick, citing the company's focus on artificial intelligence and robotics, in a note on Sunday. What Happened: The endorsement comes despite Tesla's recent challenges, including a 45% drop in European sales in January and a decline in 2024 annual deliveries. Analyst Adam Jonas highlighted the company's shift from a "pure automotive play" to a diversified focus on AI and robotics. Jonas reiterated his $430 price target for Tesla, making it one of the highest on Wall Street, implying nearly a 51% upside to the stock's closing price on Monday. This aligns with CEO Elon Musk's strategy of pivoting the company towards AI and robotaxis. In the research note, Jonas stated that the market potential for non-automotive applications of embodied AI is significantly larger and will be adopted more rapidly than autonomous vehicles. "Humanoid robot opportunity is not in our base or bull case but is becoming serious enough to move the stock. On our calculations, every 1% of U.S. labor force that can be captured by Tesla Optimus is worth approximately $100/TSLA share," explained Jonas. Jonas is also well aware of Tesla's challenges as an EV manufacturer. He cautioned in the note, "EV 'winter may be prolonged and could still require further steps to mitigate further potential losses near term." While Musk expects sales to increase with the introduction of more affordable models, Jonas suggests that deliveries could decrease in 2025, offering an "attractive entry point" for investors. SEE ALSO: DeepSeek Loses Top Spot As Tencent's Yuanbao AI Becomes The Top iPhone App In China Amid Intensifying AI Battle Why It Matters: Despite these optimistic projections, Tesla's stock has underperformed the broader U.S. market, declining nearly 25% year-to-date. The stock fell nearly 40% from its December peak, erasing almost $137 billion from CEO Elon Musk's wealth. This drop was largely due to a nearly 50% decline in European sales in January, amid potential tariffs and ongoing Musk's political involvement in the federal cost-cutting efforts. Meanwhile, Tesla Chair Robyn Denholm on Monday sold nearly $33.7 million worth of the company's stock, as part of a previously adopted trading plan. This sale followed a trend among Tesla insiders offloading shares as the company navigates macroeconomic uncertainties and intensifying competition in the EV market. READ MORE: Polestar Vs. Tesla: Can Smaller EV Company Disrupt Giant Facing Boycotts, Protests With 'Trade In' Offer? Image via Shutterstock Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. TSLATesla Inc$281.66-1.05%OverviewMarket News and Data brought to you by Benzinga APIs

Morgan Stanley's Jonas names struggling Tesla a top pick, sees nearly 50% comeback

Tesla shares can make a major recovery after a rough start to the year, boosted by its AI and robotics ambitions, according to Morgan Stanley. Analyst Adam Jonas named Tesla his new top pick in U.S. autos, highlighting the embattled electric vehicle maker's opportunity in autonomy and robotics as the catalyst for its growth moving forward -- rather than its cars. He has an overweight rating on the stock, and his $430 price target implies about 46.8% potential upside for Tesla shares. "TSLA FY25 deliveries could potentially decline YoY, creating an attractive entry point to our preferred embodied AI name," Jonas said in a Sunday note to clients. "Tesla's YTD auto deliveries have been mostly below expectations, but not particularly narrative changing. Tesla's softer auto deliveries are emblematic of a company in the transition from an automotive 'pure play' to a highly diversified play on AI and robotics." Jonas' call comes after a tough run for Tesla shares, which have plunged more than 27% this year and are down more than 40% from an all-time high reached in December. That pullback comes as investors fear CEO Elon Musk gets more involved in Washington, potentially taking his attention away from the automaker and alienating customers. Tesla sales across Europe fell 45% last month, while rival electric vehicle makers saw a spike in demand, adding further concern to the stock's growth story. Humanoid robots are still not in the firm's base or bull case for Tesla stock, even though Jonas believes that they hold a potential multidecade, trillion-dollar opportunity largely and that the adoption curve of "non-auto expressions of embodied AI" (such as humanoids) could accelerate faster than that for autonomous cars. But humanoids are now "becoming serious enough to move the stock," Jonas said in the note, adding that every 1% of the U.S. labor force that can be captured by Tesla's Optimus robot is worth about $100 per Tesla share. "While autos still matter, we see embodied AI as the driver for upside to our $800 bull case," he continued, citing a target suggests shares could see a whopping 173% potential gain. TSLA 1Y mountain Tesla stock performance. Beyond in robotics and autonomous technologies, Jonas expects Tesla to see further growth in its energy storage portfolio. "We believe 2025 will be a year where investors will continue to appreciate and value these existing and nascent industries of embodied AI where we believe Tesla has established a material competitive advantage," he added. Tesla shares popped 2% after Jonas' call. Overall, analysts are split on the automaker. LSEG data shows 24 of 53 analysts have a buy or strong buy rating. However, another 17 rate it a hold, while 12 have an underperform or sell rating.

Morgan Stanley reinstates Tesla as 'Top Pick' with nearly 50% upside to its target By Investing.com

Investing.com -- Morgan Stanley (NYSE:MS) has reinstated Tesla (NASDAQ:TSLA) stock as its 'Top Pick' in U.S. autos, with its price target of $430 implying more than 50% upside from the company's current share price. With Tesla shares down nearly 30% year-to-date, the Wall Street firm sees this as a compelling entry point, emphasizing the company's evolving role beyond electric vehicles (EVs) and into AI and robotics. Tesla's auto deliveries have softened, but Morgan Stanley views the company as transitioning from an automotive "pure play" to "a highly diversified play on AI and robotics." The bank expects Tesla's total addressable market (TAM) to expand significantly as AI moves from the digital world to the physical realm, encompassing broader domains beyond just autonomous vehicles. One of the key drivers of Tesla's upside is its potential in humanoid robotics. Morgan Stanley analysts led by Adam Jonas note that "every 1% of US labor force that can be captured by Tesla Optimus is worth approximately $100/TSLA share." They see growing investor attention in this segment, with the potential for humanoid robots to be a larger opportunity than autonomous vehicles. Tesla's energy business is also gaining traction. Analysts believe that Tesla Energy, driven by increasing global energy demand and AI-driven power consumption, could eventually be worth more than the company's auto business. They highlight that Tesla's energy storage margins could be roughly double that of its automotive segment, reinforcing the company's growing presence in the sector. Another important factor contributing to Morgan Stanley reinstating Tesla as its Top Pick is the company's declining exposure to China risks. The company's China sourced revenues accounted for 21% of total Tesla revenues in 2024, but that figure is projected to decline systematically. By 2030, the analysts forecast that China will represent approximately 10% of Tesla's auto unit volume and 6-7% of total group revenue. In addition, Morgan Stanley's bullish thesis is supported by Tesla's growing revenue from recurring services and its strong position in U.S. manufacturing. While Tesla's long-term trajectory in AI and robotics presents significant upside, the firm acknowledges near-term risks. "EV 'winter' may be prolonged and could still require further steps to mitigate further potential losses near term," analysts said. They also raise concerns about Tesla's governance structure, specifically Elon Musk's push for a 25% blocking minority stake in the company, and high near-term expectations around FSD/robotaxi solutions. Still, while Tesla's path may be volatile and nonlinear, analysts expect 2025 to be a year when investors will "continue to appreciate and value these existing and nascent industries of embodied AI where we believe Tesla has established a material competitive advantage." They reiterated their $800 bull case target for Tesla stock.

Tesla Stock Gains as Morgan Stanley Calls EV Maker Its 'Top Pick' for US Autos

Analyst Adam Jonas explained Tesla's falling sales were a sign the company is shifting from simply being a car company to also a technology provider. Tesla (TSLA) shares charged higher Monday after Morgan Stanley made the electric vehicle (EV) maker its "Top Pick" in the U.S. automobile sector as the firm expands its reach into artificial intelligence (AI) and robotics. Analyst Adam Jonas wrote in a note to clients that while Tesla's year-to-date deliveries have been mostly below expectations, he didn't see it as "particularly narrative changing." Instead, Jonas said that was "emblematic of a company in the transition from an automotive 'pure play' to a highly diversified play on AI and robotics." Jonas argued that as AI moves from the digital world to the physical world, Morgan Stanley expects to see Tesla's Technology Acceptance Model (TAM), which is used in self-driving cars and other applications, will "further expand to broader domains." Jonas, who has an "overweight" rating on the stock, explained that he felt Tesla had a more than 50% upside to Morgan Stanley's price target of $430, with a "bull case" scenario of $800. He added that fiscal year 2025 deliveries could possibly fall, "creating an attractive entry point to our preferred embodied AI name." Tesla shares, which advanced 2% to about $299 Monday morning, have increased by nearly 50% over the past year.

Tesla: Can AI Ambitions Make $430 Target a Real Possibility? | Investing.com UK

Tesla (NASDAQ:TSLA) has recently garnered significant attention in the financial markets following a favorable analysis by Morgan Stanley. The company's stock saw a modest increase of 2% after analyst Adam Jonas projected a potential rise to $430 per share. This optimistic forecast is attributed to Tesla's strategic shift towards integrating artificial intelligence and robotics into its operations. Despite previous setbacks, including a notable decline in sales and controversies surrounding CEO Elon Musk's political engagements, the company remains a strong contender in the auto sector. The upcoming release of Tesla's first-quarter results on April 22 is anticipated to provide further insights into its financial health and strategic direction. Tesla's stock has experienced fluctuations over recent weeks, reflecting broader market dynamics and investor sentiment. The stock s currently trading at $301.13, up 2.87% over the day. Over the past year, Tesla's stock has seen a wide range, with a 52-week low of $138.8 and a high of $488.54. Key financial metrics indicate a robust market position for Tesla. With a market capitalization of $962.25 billion and a trailing P/E ratio of 145.93, the company continues to demonstrate significant growth potential. The forward P/E ratio of 92.33 suggests investor confidence in future earnings growth. Additionally, Tesla's debt to equity ratio of 18.489 and current ratio of 2.025 reflect a stable financial foundation, enabling the company to pursue its ambitious expansion plans. While Tesla's future prospects appear promising, the company faces several challenges that could impact its trajectory. Recent protests and political controversies involving CEO Elon Musk have affected public perception and sales. A Quinnipiac poll highlighted public disapproval of Musk's involvement in the Trump administration, which could pose reputational risks for the brand. Furthermore, increasing competition in the electric vehicle market presents additional hurdles for Tesla as it seeks to maintain its leadership position. In response to these challenges, Tesla is pivoting towards a broader focus on AI and robotics. This strategic shift aims to diversify the company's offerings and capitalize on emerging technological trends. By transitioning from a purely automotive focus, Tesla seeks to leverage its expertise in innovation to explore new markets and opportunities. Analyst Adam Jonas's projection of the high price target reflects confidence in Tesla's ability to navigate these challenges and achieve long-term growth. *** Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.