Tesla’s stock could climb to $465 according to Wall Street analysts. Here’s the crazy part, they are offering that price point based on a business model that Tesla hasn’t even said it would enter. According to analysts, the company will make a big announcement in the next 12 to 18 months and it will revolutionize the way Americans travel.
In a research note Monday, Morgan Stanley’s Adam Jonas argues that the auto industry is changing rapidly after 100 years of “human-driven, privately owned, internal-combustion vehicles.” He believes Tesla is about to become a “dominate” force in the industry. According to Jones, Tesla is poised to join the sharing economy, allowing customers to share electric vehicles as they travel to various locations.
Jonas’ team raised the expected price for Tesla from $465 from $280, a 66% increase. That’s 91% higher than Friday’s closing price of $243.
Here’s the main note from Jonas:
Given the pace of technological development both within Tesla and at rival technology and mobility companies, we would be surprised if Tesla did not share formalized business plans on shared mobility within the next 12 to 18 months. This could potentially be followed by commercial introduction in 2018, shortly after the launch of the Model 3, which we think could form the backbone of a possible Tesla Mobility 1.0 urban transport PODS (Position on Demand Service) in 2018. We view this business opportunity as potentially additive to Tesla’s existing model of selling human-driven cars to private owners and see potential for this model to conceivably more than triple the company’s potential revenues by 2029. That is, selling miles in addition to selling cars.
Jonas expects the big three auto manufacturers and other developers to follow suit.
“100% of Tesla’s cars are electric, connected, and able to ‘learn’ through over-the-air firmware updates at any time. No other established automaker can claim this today. As we have written for sometime, we expect all car companies would eventually see nearly 100% of their revenues shift from the sale of human-driven/individually-owned cars to robot-driven/shared cars.”
In the meantime, Tesla is in the midst of raising nearly $700 million in extra capital so the company can continue its operations through 2016.