Tesla is Wall Street’s “most undervalued AI play” says broker

Tesla (NASDAQ:TSLA) is Wall Street’s “most undervalued AI play”, that’s according to West Coast stockbroker Wedbush, which today repeated an ‘outperform’ rating with a $300 twelve-month price target that suggests some 14% upside to the current share price of $263.26.

The broker’s premise is that next month’s so-called ‘robotaxi’ day – its pencilled in for 8 August, but recent rumours suggest a delay until October – will see Tesla and Elon Musk layout an AI-centric roadmap for growth.

“The key for Tesla's stock looking ahead is the Street recognizing that Tesla is the most undervalued AI play in the market in our view with a historical Robotaxi Day ahead for Musk and Tesla that will lay the yellow brick road to FSD and an autonomous future,” Wedbush analyst Daniel Ives said in a note.

“We believe the AI story could be worth $1 trillion alone to the broader Tesla story over the coming years.”

“As part of Tesla’s long driven full self-drive thesis and the company’s first mentions of robotaxis in 2019, it is now official that robotaxi will become a part of the Tesla portfolio as Musk and Tesla get ready for the first Tesla robotaxi to be unveiled on August 8th.

“Musk has said in the past that Tesla will make a car without controls for human use, saying in the past that FSD will reach a point of full autonomous use for taxi and driverless scenarios.”

According to Ives, Tesla is more of an AI and robotics play than a traditional car company.

Moreover, he reckons “the rubber is about to hit the road” in terms of the market fully comprehending this, and, will be a ‘lynchpin day’.

Significantly, next month’s showcase comes against an improved industry backdrop.

“In a nutshell, the worst is in the rear-view mirror for Tesla as we believe the EV demand story is starting to return to the disruptive tech stalwart ahead of a historical Robotaxi Day on August 8th with the bears now heading back into hibernation mode and their caves,” Ives said.