Morgan Stanley: "Tesla, Top Preferred Auto Stock"… Tesla Soars 6%

Top Pick in Automotive Sector Changes from Ford to Tesla
Target Price Raised to $310, Investment Rating Upgraded to 'Overweight'

Global investment bank Morgan Stanley designated Tesla as the 'top pick' in the automotive sector, causing Tesla's stock price to soar nearly 6%.

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On the 29th (local time) at the New York Stock Exchange (NYSE), Tesla closed trading at $232.1 per share, up 5.6% from the previous trading day.

The sharp rise in Tesla's stock price is attributed to Morgan Stanley analyst Adam Jonas switching the top pick in the U.S. automotive sector from Ford to Tesla on the same day. Morgan Stanley raised Tesla's target price to $310 and upgraded its investment rating to 'Overweight.'

Morgan Stanley evaluated that Tesla lowered its breakeven point and improved its cash flow generation capability through large-scale restructuring in the second quarter of this year. It also viewed that Tesla aggressively reallocated resources, technology, personnel, and capital within the automotive division. The bank diagnosed that operational efficiency improvements also reduced risks related to the Chinese market.

Furthermore, Morgan Stanley judged that as traditional internal combustion engine vehicle manufacturers withdrew their plans to expand electric vehicles, Tesla could secure a more dominant position in the electric vehicle market. In addition, Tesla's energy-related business is gaining attention, and the commercial utilization opportunities of Tesla's artificial intelligence (AI) technology could also be significant.

However, Morgan Stanley pointed out that expectations for Tesla's Full Self-Driving (FSD) and robotaxi may be too high in the short term.

This content was produced with the assistance of AI translation services.