Tesla Inc (NASDAQ:TSLA) shares are up over 50% over the past month, with analysts at Wedbush saying the electric vehicle maker's turnaround has begun as demand stabilises after a round of price cuts and Wall Street reappraises what AI could do for the company.
The Elon Musk-bossed group's march towards an annualised production of two million cars should be reached over the coming quarters, providing clear momentum, which will be helped by easier comparatives when 2025 rolls around.
Wedbush's bullish chief analyst Dan Ives says if Wall Street starts to recognize that Tesla is "the most undervalued AI play in the market" this will be key for the stock, with "the worst in the rear-view mirror".
"We believe the AI story could be worth $1 trillion alone to the broader Tesla story over the coming years," Ives wrote in a note to clients on Thursday, reiterating his 'outperform' rating and $300 share price target.
The August 8 'Robotaxi Day' announcements from Musk and co will be a "key historical moment for the Tesla story", the analyst explained.
Tesla reaching a $1 trillion-plus valuation from its current $850 million will be built on Musk's plans for Robotaxis and Full Self-Driving (FSD).
Tesla "appears to be reflecting" on this angle, Ives said, with the latest FSD version 12.4 and now China FSD testing underway.
Following the company’s first mentions of robotaxis in 2019, Musk confirmed that robotaxi will become a part of the Tesla portfolio with an unveiling next month.
"We believe in a bull case scenario the Tesla FSD piece/segment could be worth $1 trillion alone.
"We continue to believe that Tesla is more of an AI and robotics play than a traditional car company.....now the rubber meets the road as the Street anticipates August 8th as a key linchpin day for the Tesla story."
Ives also suggested if Donald Trump wins this year's election it "would be an overall negative for the EV industry as likely the EV rebates/tax incentives get pulled".
However for Tesla he said Trump in the White House is a "potential positive" as the company "has the scale and scope that is unmatched in the EV industry and this dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players (BYD, Nio, etc.) from flooding the US market over the coming years."