Tesla Collapses To $182 But It’s Worth $345 Says Morgan Stanley

TL;DR

Morgan Stanley lowers Tesla price target to $345, citing challenges in the EV market and AI optimism.

Transcript

Morgan Stanley with a new note Tesla 2024 a challenging year for electric vehicles cutting estimates and price Target to $345 down from $380 per share according to Morgan [ __ ] Stanley Global EV momentum is stalling the market is over supplied versus demand I just I'm recording this in late January 2024 and Morgan sley have literally just publishe... Read More

Key Insights

• 🥺 Global EV momentum challenges lead to a cautious outlook for Tesla in 2024.
• 🎁 AI and Robotics present potential growth opportunities, but their impact on valuation is not fully accounted for.
• 🎯 Concerns over oversupply versus demand in the EV market contribute to Tesla's price target reduction.
• 🧑‍🏭 Tesla's Fleet size and recurring revenue potential are critical factors in its valuation.
• 🚚 Morgan Stanley's base case estimates for Tesla's future growth and volume deliveries are conservative.
• 👾 Uncertainty in EV incentives and political risks impact the pace of EV adoption.
• 🪛 Residual value risks and challenges in the EV market drive uncertainties for consumers and investors.

Questions & Answers

Q: Why did Morgan Stanley lower Tesla's price target to $345?

Morgan Stanley cited challenges in the EV market, with concerns about Global EV momentum stalling and oversupply versus demand, leading to a cautious outlook for Tesla in 2024.

Q: What factors contribute to the uncertainty in the future of EV incentives?

Morgan Stanley highlights weakening consumer EV incentives globally, leading to uncertainty as governments reassess budgets and the demand for EVs, questioning the necessity of continuing incentives to drive adoption.

Q: How does Tesla's Fleet size impact its valuation according to Morgan Stanley?

Morgan Stanley's valuation of Tesla is heavily influenced by their estimates of Fleet size, with discrepancies in Fleet estimates affecting the overall valuation of Tesla's core auto business and potential future growth in recurring revenue.

Q: What is the significance of Tesla's AI and Robotics ventures in Morgan Stanley's analysis?

Morgan Stanley acknowledges the potential value of Tesla's AI and Robotics ventures but emphasizes that these aspects are not fully factored into the price target, raising questions about the overall valuation of Tesla's non-auto businesses.

Summary & Key Takeaways

• Morgan Stanley predicts a challenging year for Tesla in 2024, lowering price target to $345.

• Concerns over stalling Global EV momentum due to oversupply versus demand.

• AI and Robotics offer potential, but Tesla's core auto business valuation questioned.