Posted on June 02, 2017 by Matt Pressman
This week, Morgan Stanley analyst Adam Jonas commented again on Tesla [NASDAQ: TSLA]. Jonas has alternated his POV when analyzing Tesla ranging from bull to bear. His views on the company continue to evolve. Morgan Stanley maintains Equalweight on Tesla's price target of $305.00. According to Street Insider, Jonas "believes it is now time to ponder if Tesla is the Amazon of autos given its valuation is above that of Ford and General Motors and the company begins to challenge the characterization that it is just a car company."
Above: Tesla Model X (Source: Tesla)
Jonas states, "We believe the market is increasingly coming around to the idea of giving Tesla a low chance of success in a far larger addressable market (transport network, data, time) rather than a high chance of success in a smaller addressable market (cars/machines)." That said, Jonas further believes that the market may price in the value of Tesla as a strategic or trophy asset as the company builds out infrastructure and unveils its "Tesla Network". He believes given this potential that it is possible for Tesla to reach his bull case PT [price target] of $511.
Above: Morgan Stanley's Adam Jonas discusses his thoughts on Tesla (Youtube: Bloomberg TV Markets and Finance)
Electrek also reported on Morgan Stanley's most recent analyst report. In it, Jonas also writes that, "A far larger portion of investors we speak with now understand that Tesla is ‘more than a car company’ but at the nexus of shared, autonomous and electric transportation. We have long viewed Tesla’s stock as a call option on disrupting a $10tn global market for mobility rather than an equity exposed to a $1.5tn traditional light vehicle market."
Above: Tesla Model S (Image: The Telegraph)
And, it's not just Amazon who Jonas is comparing with Tesla: "In our experience, one cannot have a conversation about machine learning and the multi-trillion-$ transport market without talking about the role of Amazon, Alphabet, Apple or Tesla. Tesla is a part of this very important discussion. There is little doubt that Tesla has a seat at the table for this discussion – yet is valued at 1/10th the market cap of Amazon, 1/13th the market cap of Alphabet and 1/15th the market cap of Apple.”