Tesla supercomputer likely to boost market value by $600bln

Tesla’s Dojo supercomputer could power a near $600 billion jump in the automaker’s market value by boosting the adoption of robotaxis and its software services, Morgan Stanley analysts said.

The electric-vehicle maker (EV) started production of the supercomputer used to train artificial intelligence (AI) models for self-driving cars in July and plans to spend more than $1 billion on Dojo through next year.

Dojo can open up new addressable markets that “extend well beyond selling vehicles at a fixed price,” Morgan Stanley analysts, led by Adam Jonas, said in a note on Sunday.

“If Dojo can help make cars ‘see’ and ‘react,’ what other markets could open up? Think of any device at the edge with a camera that makes real-time decisions based on its visual field.”

The Wall Street brokerage upgraded its recommendation on Tesla’s stock to “Overweight” from “Equal-weight” and made it their “top pick,” replacing Ferrari’s U.S.-listed shares .

Tesla shares were up nearly 5.7% at $262.63 in premarket trading.

Morgan Stanley raised its 12-18 month target on Tesla’s shares by 60% to $400 – the highest among Wall Street brokerages as per LSEG data – which, it estimated, would give the EV maker a market capitalization of about $1.39 trillion.

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