Tesla Inc (NASDAQ:TSLA), the electric vehicle (EV) behemoth, is not just about cars anymore.
According to a recent note from Wedbush Securities, the company's supercharger network is becoming a significant part of its valuation, hinting at a broader strategy.
Tesla's decision to open its supercharger network to other Original Equipment Manufacturers (OEMs) like General Motors (GM), Ford, and Mercedes-Benz suggests a vision beyond just selling vehicles.
The Sum-of-the-Parts Story
Wedbush's analysis highlights Tesla's multi-faceted approach.
The company's supercharger network, energy business, AI-driven autonomous path, unmatched battery ecosystem, and global production scale are all pieces of a larger puzzle.
Tesla's supercharger business alone, according to Wedbush, could translate to a $10 billion to $20 billion business by 2030, accounting for 3%-6% of total revenues.
Charging Ahead with Infrastructure
Under President Biden's $7.5 billion charging initiative, Tesla committed to doubling its supercharger network. This move is strategic.
While Tesla's connectors differ from the combined charging system (CCS) used by many, the company is pushing forward, planning to add an additional 7.5k chargers by the end of 2024.
With major auto players partnering with Tesla's North American Charging Standard (NACS), the company is well-positioned to benefit from the growing need for EV charging infrastructure.
The Magic of Adaptation
Tesla's introduction of the "Magic Dock" is a game-changer. This adapter allows non-Tesla EVs to charge on the NACS standard, expanding Tesla's potential charging footprint.
As the NACS gains traction, Tesla stands to benefit from the increasing demand for charging stations, especially with the current infrastructure struggling to meet the rising demand.
Battery Innovations: Powering the Future
Tesla's focus isn't limited to charging. The company's advancements in battery technology, particularly the 4680 cells, are noteworthy.
These cells, according to Wedbush, are seen as the future of Tesla's battery pack ecosystem. They promise significant improvements in energy, power, and vehicle range.
The company's investment in its Nevada facility, aiming for 100 gigawatt-hours of cells annually, underscores its commitment to leading in battery technology.
Vehicle Production: Meeting Global Demand
Despite rising global competition, Tesla's demand remains robust.
The company's target of 1.8 million deliveries for FY23 seems achievable, especially with the highly anticipated Cybertruck on the horizon.
This electric truck, with its growing reservation numbers, positions Tesla to tap into the burgeoning electric pickup market.
Expanding the Global Footprint
Tesla's global ambitions are evident in its investments in Gigafactories.
From Shanghai to Berlin and Austin, these factories are pivotal in Tesla's plan to meet global demand.
Recent discussions about a new Gigafactory in India further highlight the company's intent to dominate the EV market across continents.
Full-Self Driving (FSD): The Road to Autonomy
Tesla's Full-Self Driving capabilities, despite safety concerns, are seen by Wedbush as a value driver for the company.
With the recent V12 update and the company's investment in artificial intelligence, Tesla is inching closer to achieving full autonomy.
The company's approach, focusing on camera vision over radar, emphasizes its belief in AI's potential to revolutionize driving.
Premium rating
Wedbush's deep dive into Tesla's multifaceted operations culminates in a bullish stance on the company.
The investment bank rates Tesla's shares as 'outperform' and has set a share price target of $350.
This target represents a 50% premium to the current share price, underscoring Wedbush's confidence in Tesla's growth trajectory and its ability to capitalize on the myriad opportunities ahead.
As the EV landscape evolves, Tesla's strategic moves, as highlighted by Wedbush, position it not just as a car manufacturer but as a pivotal player in the broader green energy transformation.