(Reuters) – Tesla’s supercomputer, Dojo, to train AI models for autonomous cars could give the electric vehicle maker an “asymmetric advantage” and boost its market capitalization by about $600 billion, or 76%, Morgan Stanley. is estimated.
Tesla began production of the Dojo in July and plans to spend more than $1 billion over the next year.
Morgan Stanley analysts led by Adam Jonas said in a note published Sunday that Dojo could open up new addressable markets that “extend far beyond selling vehicles at a fixed price.”
Jonas said, “If Dojo can help cars ‘see’ and ‘react’, what other markets could open up? Think about any device with a camera that can make real-time decisions based on its field of view.” “I take decisions.”
The Wall Street brokerage upgraded its recommendation on Tesla’s stock to “overweight” from “equal-weight” and made it its “top pick” over Ferrari’s US-listed shares.
Morgan Stanley raised its 12-18 month target on Tesla shares by 60% to $400 – the highest among Wall Street brokerages according to LSEG data – estimating the EV maker to have a market capitalization of about $1.39 trillion. will get.
That compares with its current market cap of about $789 billion, after the stock closed at $248.5 on Friday.
Jonas hopes Dojo will bring the most value to the software and services it offers.
The analyst raised his forecast for revenue from Tesla’s network services business to $335 billion in 2040 from $157 billion.
Jonas expects the unit to account for more than 60% of Tesla’s core earnings by 2040, nearly doubling by 2030.
“This growth is largely driven by the emerging opportunity in third-party fleet licensing, coupled with increased ARPU (average monthly revenue per user),” Jonas said.
(Reporting by Roshan Abraham and Susan Mathew in Bengaluru; Editing by Savio D’Souza)