Tesla (NASDAQ: TSLA) exploded 7% on Monday, November 24, a day after CEO Elon Musk provided some fresh updates on the company’s in-house chip development.
In a social media post, the world’s richest man made it known that Tesla has had a team dedicated to advancing artificial intelligence (AI) chips for many years, millions of which are reportedly in use not only in autonomous vehicles but also in data centers.
Elon Musk A16 chip impact on Tesla
“Most people don’t know that Tesla has had an advanced AI chip and board engineering team for many years. That team has already designed and deployed several million AI chips in our cars and data centers. These chips are what enable Tesla to be the leader in real-world AI,” Musk wrote about Tesla’s AI chip development.
Elaborating on the long-term goals, Musk promised his followers that the new AI6 chips, which the company expects to produce at high volumes, will “profoundly change the world” and save “millions of lives.”
“The current version in cars is AI4, we are close to taping out AI5 and are starting work on AI6… We expect to build chips at higher volumes ultimately than all other AI chips combined… These chips will profoundly change the world in positive ways, saving millions of lives due to safer driving and providing advanced medical care to all people via Optimus,” he added.
Tesla stock price forecast
Musk’s post sent shockwaves through the market. In the early hours on Monday, Melius Research labeled the automaker a “must own” stock, citing rapid progress in autonomy. In his note, analyst Rob Wertheimer said his bullish stance reflects an imminent technological shift:
“One of the reasons we called Tesla a ‘must own’ in our recent launch — despite all the obvious risks — is that the world is about to change dramatically,” Wertheimer wrote.
The past week has seen a couple of other bullish takes on the electric vehicle (EV) leader. Namely, on November 20, Alexander Potter at Piper Sandler reiterated his “Buy” rating with a $500 price target on the grounds of the FSD version 14 and smooth robo-taxi demonstration rides.
On November 17, Stephen Gengaro at Stifel Nicolaus raised his Tesla price target from $483 to $508, also with a “Buy” rating. Unsurprisingly, the analyst referred to stronger-than-expected advances in autonomous technology and robotaxi operations, areas he views as “critical.”
Wall Street Tesla stock price target 2026
With the new price revisions, the average Tesla stock price target for the next 12 months sits at $383.37, indicating a downside risk of more than 8%, as per the stock market analysis platform TipRanks.
According to the same data, the company currently has a “Hold” consensus rating based on 14 “Buys,” 10 “Holds,” and 10 “Sells” issued by a total of 34 analysts over the past three months.
Featured image via Shutterstock
