Morgan Stanley reiterated an Overweight rating on “Top Pick” Tesla $Tesla Motors(TSLA)$ and cut their 12-month price target on the electric auto stock to $345.00 (From $380.00) ahead of the company’s 4Q earnings report, expected to be released on January 24th.
Overall, Tesla is now expected to round out its fiscal 2023 with annual earnings down -22% to $3.16 a share versus $4.07 per share in 2022. However, FY24 EPS is forecasted to rebound and jump 21% to $3.82 per share. Optimistically, total sales are anticipated to have climbed 20% in FY23 and are projected to expand another 20% this year to $117.47 billion.
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“Global EV momentum is stalling. The market is over-supplied vs. demand.” Wrote analysts at Morgan Stanley in a note.
Negative changes in the global EV market significantly affect Tesla and could reasonably result in a short-term negative impact on the stock price.
However, investors should not overlook ongoing advancements in Tesla's other ventures, particularly those related to automobiles.
Additionally, there are areas like Optimus, not factored into Morgan Stanley’s price target, but the market might consider.
Analysts anticipate gaining more insights into these aspects during the upcoming 2024 Tesla AI day.
As for Tesla CEO, Elon Musk’s “discomfort” moving the company forward with AI without increased voting power, Tesla is the sole stock in Morgan Stanley’s coverage that is genuinely AI-enabling. Their Overweight thesis and Top Pick status rely heavily on Tesla gaining value as an AI enabler.
Any alteration in the organizational or legal structure that hinders Tesla's involvement in AI development could adversely impact the OW investment thesis. Analysts anticipate this matter will be closely examined during Wednesday's analyst call.
$Tesla Motors(TSLA)$ stock price forecast
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