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Tesla Stock Target Raised to $430 by Morgan Stanley, Driven by AI and Robotics Expansion

Mellissa · 04 Mar1.1K Views

Image Credit: Reuters

Morgan Stanley analyst Adam Jonas predicted Monday that Tesla (TSLA) shares could climb to $430 as the company diversifies into artificial intelligence (AI) and robotics.

Tesla’s stock plummeted nearly 28% in February due to declining EV sales, leading to concerns among investors about CEO Elon Musk’s political involvement potentially alienating buyers. On Monday, Tesla’s stock dropped more than 2.8%, despite an initial 2% increase after Jonas's optimistic note was released.

Jonas forecasts that Tesla’s full-year 2025 deliveries might decline year-over-year, which he sees as an “attractive entry point” for investors. He reinstated Tesla as a top pick in the auto sector with a price target of $430, representing a 50% rise from its closing price of $292.98 on Friday, with a bull case of $800.

He pointed out that Tesla's decline in auto deliveries reflects its transition from being an "auto pure play" to a diversified company tapping into AI and robotics. He added that non-auto applications of AI and robotics are likely to present larger and faster-growing opportunities than autonomous vehicles.

Tesla’s stock has almost entirely given up its 40% gain post-election, after reaching a high of $479.86 in mid-December.

While new competitors have impacted Tesla’s sales, Musk’s political involvement has also contributed to the company's struggles. Protests at Tesla showrooms in February and controversy over the firing of government workers at Musk's DOGE project have led to criticism from both the public and GOP lawmakers. A recent Quinnipiac poll revealed that 53% of voters disapprove of Musk playing a key role in the Trump administration, while 39% approve.

Tesla is scheduled to report its first-quarter results on April 22.

Jonas is not alone in his optimism for Tesla. Last month, Wedbush analyst Dan Ives also reiterated his “Outperform” rating and maintained a price target of over $500, despite concerns about Musk’s political involvement in the Trump administration.