Boasting a year-to-date surge of over 134%, Tesla stands as a key player among the seven tech juggernauts driving the remarkable recovery of the S&P 500.
While concerns over depressed margins and perceived overvaluation led some to reconsider their stance, a major Wall Street player remains bullish on Tesla with a robust 12-month price target of $380 for the carmaker’s stock.
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Morgan Stanley sees 50% upside in Tesla stock
Morgan Stanley analysts led by Adam Jonas reiterated their Overweight rating on Tesla stock with a 12-month price objective of $380. That target suggests a possible upside of more than 50% from the EV maker’s current share price.
With this optimistic outlook, Morgan Stanley is one of the most bullish investment firms when it comes to TSLA.
“It’s not terribly surprising that auto investors are cautious on Tesla given increased competition and a lack of high-volume new products in 2024.”– analysts at Morgan Stanley wrote in a note.
Still, the Wall Street banking giant does not expect an easy year for the carmaker.
Notably, the strategists said there is a chance that Tesla’s gross auto margin could reach 10% in 2024, however, it is also possible for the company’s core operating margin to turn briefly negative in the coming year, they said.
One factor that could weigh on Tesla’s stock is the continuation of the ongoing negative developments in the auto industry.
Not just a car company
Yet, Tesla is not solely a car company, but also “an AI company,” the analysts emphasized.
The EV giant continues to work on innovative products beyond the auto business, including the Optimus robot and the Dojo supercomputer.
Morgan Stanley’s researchers believe that Optimus is a $30 trillion opportunity that could disrupt 30% of the global market, while Dojo is expected to help the company open new markets beyond the auto domain.
Tesla stock price analysis
At press time on December 29, shares of Tesla were down 3.1% at $253.18.
The stock rose around 0.5% over the past week and 3.7% across the month, driven by the broader market rally.
Last week, a long-standing Tesla bull, Wedbush analyst Dan Ives, also raised the price target on TSLA stock to $350 from $310, citing an “increasingly bullish view of further EV share gains and margin stabilization in 2024.”
At the moment, Tesla shares face near-term resistance points at $265 and $269. Clearing these barriers would pave the way for the stock to attack the next resistance at $278, a level unseen since September.
On the downside, TSLA is supported by a 100-day moving average (MA) at $246.43, followed by a 200-day MA at $223.91, which also acts as a support.
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