Tesla Has Potential to Become Large Battery Suppler, Says Morgan Stanley

by Eva Fox August 17, 2020

Tesla Has Potential to Become Large Battery Suppler, Says Morgan Stanley

Morgan Stanley's Adam Jonas joins "Squawk Alley" to discuss Tesla's strength in the battery space and his new price target for the stock.

Jonas said that Tesla should be viewed as more than just an automotive business. The best specialists in a wide variety of fields strive to work for Elon Musk. Tesla continues to gather assets, technology, and the talent necessary in its efforts towards opening a vertically integrated battery business that can improve the industry's cost curve.

The company is making rapid advancements in the field of battery production, and may very well disrupt the EV battery industry, as well as further grow the entire space.


Morgan Stanley conducted Tesla's analysis in collaboration with its Asian Technology team (led by Shawn Kim) and expresses rising confidence in Tesla's ability to unleash even greater potential on Battery Day on September 22nd.

Jonas named the potential to grow the company's battery business as a key driver for mid-term profit. He also noted that factors other than the sale and delivery of vehicles--which have traditionally provided both top and bottom margins for the world's most valuable automaker--may begin to have increasing influence on Tesla's future success.

Based on the data that has been collected, Morgan Stanley is now valuing Tesla considering its potential 3rd party battery and EV powertrain supply businesses.

On August 13 Morgan Stanley raised its Tesla (TSLA) target price to $1,360 and updated its "bull case scenario" to $2,636.

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Article edited by @SmokeyShorts, you can follow him on Twitter

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This article is for informational purposes only. You should not construe any such information or other material as an investment, financial, or other advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, or offer by Eva Fox, Tesmanian, or any third party service provider to buy or sell any securities or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction. Eva Fox holds zero share of Tesla, Inc., and currently (at the time of this article's publishing) holds zero options or securities in Tesla Inc. and/or its affiliates.

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