Morgan Stanley Raises Tesla Price Target to $2500

Morgan Stanley analyst Adam Jonas has raised Tesla Stock bullish price target to $2500, all the way from $740 just 6 days ago. A massive rally of over 65% from the current price of $1500.

Last week after Tesla posted remarkable profitable Q2 results, that blew Wall-Street estimates off the ground, Morgan Stanley analysts Adam Jonas reiterated his stance with SELL ratings and set a price target of just $740. That story has now officially changed!.

Last week, Adam Jonas said bears would need to “nitpick” at Tesla’s numbers to put together a negative case, but Tesla’s $300 billion valuations are already discounting multiple years of strong growth.

Adam’s story is now completely different. Morgan Stanley’s Jonas on $TSLA: “For the first time during our 10 years of coverage we’re starting to model this company as a very, very large automaker. Our revised 2030 revenue forecast is over $170bn of revenues, a substantially larger company by revenue than Ford or GM.”

“Our revised $1,050 price target is based on 3mm unites by 2030 with 2x industry margins and ASPs. We would need much more than this (volume, AV revenue), while ignoring a host of near-term risks, to upgrade the stock. Remain UW.”
Morgan Stanley on Tesla Stock.

“It’s becoming increasingly obvious that Tesla is going to become a very large company, approaching (if not exceeding) Toyota or VW revenues in the next decade and leaving the world’s largest luxury OEMs behind.”

“For the first time during our 10 years of coverage, we’re starting to model this company as a very, very large automaker. Our revised 2030 revenue forecast is over $170bn of revenues, a substantially larger company by revenue than Ford or GM.”

“One year ago, we believed the legacy OEMs would have had a far more advanced strategic position to pressure Tesla market share, however, Tesla has had, in our opinion, much more freedom to expand than we initially thought, with legacy OEM EV timelines 1 to 2 years further out than our initial expectations.”

“Following Q2 results, we have restructured our revenue model to include greater model granularity (Cybertruck, Semi, Multipurpose Van, e.t.c), raising our 2030 volume forecast to 3 million. Our forecasts give Tesla credit for nearly an additional three full factories of production, which we see as reasonable given the company’s demonstrated strategy of rapid capacity expansion (three factories currently under construction/pre-construction).”

“On the 2Q call, Elon Musk reiterated the company’s desire to prioritise growth over profitability, which makes sense to us, given the company’s current advantages in attracting talent and capital, the inherently competitive nature of the auto industry.”

There you have it guys. Presently only about 7 analysts are Bullish Tesla Stock, with majority ratings the stock HOLD, and SELL respectively.

Tesla is trading around $1500 in pre-market, expect that price to move swiftly once this news goes viral. Volatility is nothing new to Tesla investors, today is surely going to be another great day to add more to the bad.

In Other News

General Motors Co on Wednesday swung to a loss for the second quarter, reflecting a forced shutdown to slow the spread of the coronavirus pandemic that left its North American plants idled through to May 18. The No. 1 U.S. automaker reported a net loss for the quarter of $806 million, or 56 cents per share, down from a profit of $2.4 billion, or $1.66 per share, a year earlier. Analysts had expected a loss of $1.77 per share for the quarter. (Reporting by Nick Carey and Ben Klayman, editing by Louise Heavens) – Reuters reports

3 thoughts on “Morgan Stanley Raises Tesla Price Target to $2500

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