Morgan Stanley analyst Adam Jonas said Monday sees shares of Tesla (TSLA) rising to $430 as it diversifies into artificial intelligence and robotics.
Shares of the EV maker plummeted almost 28% in February as the company’s EV sales slumped, leaving investors to wonder whether CEO Elon Musk’s involvement in politics was turning off buyers.
Tesla stock fell over 2.8% on Monday amid a broader tech sell-off; shares initially rose 2% as Jonas’s note circulated across Wall Street.
Jonas predicts Tesla’s full-year 2025 deliveries could decline year over year, “creating an attractive entry point” for investors. The analyst reinstated Tesla as a top pick for the auto sector, with a price target of $430, about a 50% increase from Friday’s close of $292.98, and a bull case of $800.
“Tesla’s softer auto deliveries are emblematic of a company in the transition from an automotive ‘pure play’ to a highly diversified play on AI and robotics,” he added.
At close: March 3 at 4:00:02 PM EST
“As we continue our analysis of the overlap of AI and robotics, it is increasingly clear to us that the commercial opportunity of non-auto expressions of embodied AI is likely far larger and faster-adopting than that of autonomous cars,” wrote Jonas.
Tesla stock has given up nearly all of its 40% post-election gain since hitting a closing high of $479.86 in mid-December.
As Yahoo Finance’s Pras Subramanian recently pointed out, while new competition has eaten into Tesla’s sales, there is also the effect of CEO Elon Musk and his foray into politics.
Protests at Tesla showrooms across the country in February, along with blowback from the firing of government workers by the Musk-led DOGE, have many hurling criticisms at the Tesla CEO and GOP lawmakers.
Recent surveys show that many voters disapprove of Musk’s actions, with a Quinnipiac poll from late January finding that voters oppose Musk playing a prominent role in the Trump administration by a 53% to 39% margin.
Tesla is expected to report its first quarter results on April 22.
Jonas isn’t the only Tesla bull who has predicted shares will rise. Last month, Wedbush analyst Dan Ives reiterated his Outperform rating and $500+ price target despite ongoing concerns about Musk’s involvement in President Donald Trump’s second administration.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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