"Percoco took over and immediately adjusted the price target for Tesla from $410 to $425, and changed its rating on shares from 'Overweight' to 'Equal Weight.' Percoco said he believes Tesla is the leading company in terms of electric vehicles, manufacturing, renewable energy, and real-world AI, so it deserves a premium valuation. However, he admits the high expectations for the company could provide for a "choppy trading environment" for the next year."
"He went on to describe the potential value of Full Self-Driving, highlighting its importance to the Tesla valuation: "Full Self Driving (FSD) is the crown jewel of Tesla's auto business; we believe that its leading-edge personal autonomous driving offering is a real game changer, and will remain a significant competitive advantage over its EV and non-EV peers. As Tesla continues to improve its platform with increased levels of auton"
Andrew Percoco assumed Tesla coverage at Morgan Stanley, replacing Adam Jonas. Percoco set Tesla's price target to $425 and changed the rating from Overweight to Equal Weight. Percoco views Tesla as the leader in electric vehicles, manufacturing, renewable energy, and real-world AI, warranting a premium valuation. Morgan Stanley anticipates a choppy trading environment for Tesla shares over the next 12 months due to downside to estimates and non-auto catalysts appearing priced in. Morgan Stanley would reduce the price target by 7% if market-cap hurdles are met. Percoco attributes about $60 per share of equity value to Optimus and identifies Full Self-Driving as a core competitive advantage.
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