Tesla Inc (NASDAQ:TSLA) may have left investors disappointed by its Investor Day this week, but analysts at Canaccord Genuity (TSX:CF, LSE:CF) came away with increased conviction in the electric vehicle (EV) maker’s sustainability vision, reiterating their ‘Buy’ rating for the stock and price target of US$275.
“We came away with increased conviction that the scale, resources, and vision that Tesla has and continues to amass will prove a long-term sustainable advantage,” the analysts wrote in a note to clients.
“We also maintain that Tesla’s cost leadership will not only drive EV adoption and help the company maintain its industry-leading margins but help accelerate the world’s transition to sustainable energy.”
READ: Tesla's investor day big on words but light on detail; shares fall
Tesla shares were trading up 2.9% at US$196.40 on Friday morning after dropping by double digits from about US$202 following its Investor Day event held on Wednesday after the bell.
'A treatise on sustainability'
In the note, the analysts pointed out that while the Investor Day for Tesla itself was devoid of product unveils, financial targets, or “one more things” (a Steve Jobs reference), it did leave the analysts with “much to noodle on.”
“Tesla’s analyst day and Master Plan 3 unveiling was a treatise on creating a global sustainable energy economy,” they wrote.
“From green hydrogen to heat pumps, to sustainable boats and planes, Mr Musk laid out his vision for a sustainable energy world.”
The analysts noted that battery storage is at the heart of the Master Plan, with Musk saying that 240TWh is needed to power a sustainable economy.
“To support this transformation, Mr Musk estimates the need for $10 trillion of manufacturing investment in key areas such as mining, refining, recycling, and battery/vehicle production facilities,” they wrote.
“At a tenth of the global economy, Mr Musk believes this level of spending is critical, but achievable, especially when spread over decades.”
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