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Tesla Share Price Implies Over 10M Units by 2030, Morgan Stanley Says

Stock Markets Jun 16, 2022 01:31PM ET
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© Reuters. Tesla (TSLA) Share Price Implies Over 10M Units by 2030, Morgan Stanley Says
 
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By Sam Boughedda

Morgan Stanley analyst Adam Jonas said in a note to investors Thursday that Tesla's (NASDAQ:TSLA) share price implies more than 10mm units by 2030.

In a broader note, looking at ‘what’s in the price’ for pure-play US electric vehicle names such as Tesla, Rivian (NASDAQ:RIVN), Lucid (NASDAQ:LCID), and Fisker (NYSE:FSR), Jonas said that "Tesla’s share price implies >10mm units by 2030 at a 20% EBITDA margin on our model."

Jonas, a longtime Tesla bull, currently has an Overweight rating and a $1,300 price target on Tesla.

"We note that our $1,300 price target is based on 8.7mm units by 2030 which supports just over $600/share of core auto value with the remaining $700/share driven by recurring revenue and other services from the platform," wrote Jonas.

"Our PT of $1,300 is comprised of 6 components: (1) $608/share for core Tesla Auto business on 8.6mm units in 2030, 8.5% WACC, 15x 2030 exit EBITDA multiple, exit EBITDA margin of 20%. (2) Tesla Mobility at $74 on DCF with ~500k cars at $1.7/mile by 2030. (3) Tesla as a 3rd party supplier at $131/share. 4) Energy at $111/share, 5) Insurance at $37/share, & 6) Network Services at $338, 25mm MAUs, $100 ARPU by 2030, 20% discount," he added.

Regarding potential risks to the upside, the analyst listed them as disclosure on service revenue, increased full self-driving attach rate, cost milestones on new batteries, new model introductions, a 3rd party battery win, and geographic penetration and new capacity.

Tesla Share Price Implies Over 10M Units by 2030, Morgan Stanley Says
 

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