Tesla’s stock (TSLA) is rising significantly today after the market had more time to digest what happened at AI Day.

The company is seen as being in the right position to “tackle the world’s hardest problems.”

After Tesla held its AI Day, the market didn’t seem really impressed by the progress the company has made in developing AI software and hardware toward full self-driving capability.

But now, a few days later, Tesla’s stock is up 4% after the market has had more time to digest all the news coming out of the event.

Morgan Stanley’s Adam Jonas, one of the most popular Wall Street, released a note to clients about his own impression of the event, which gets communicated to a lot of investors.

Jonas agreed with Tesla CEO Elon Musk’s message that the company is now more than an automaker:

“We think the message of AI Day goes beyond humanoid bots and exaflops. Tesla is running one of the world’s largest, and arguably most ambitious, R&D laboratories to tackle the world’s hardest problems. Investors can’t resist funding the effort.”

He drew links to Thomas Edison’s work:

“History is a great teacher, and I cannot help but see parallels between Elon Musk’s engineering efforts at both Tesla and SpaceX (as well as Neuralink, Boring Co, etc.) and those of Thomas Edison in the 1870s and 1880s. The incandescent light bulb, phonograph, electric grid, motion picture camera… these are just some of the more well-known inventions borne out of his more than 1,000 US patents. But out of all of Edison’s inventions, many historians say his greatest was the R&D laboratory where men and women from around the world (who Edison referred to as his ‘Muckers’) worked long hours into the incandescent night to perfect a product for commercial use. Today, Elon Musk offers the R&D ‘lab’ at Tesla and SpaceX to try the impossible until it’s possibly… possible.”

The analysts also put actual numbers behind this more colorful commentary.

Jonas expects Tesla to grow its R&D budget to $26 billion, the equivalent of Apple’s, by the year 2027:

“We forecast Tesla’s combined capex and R&D budget to reach $26bn by FY27. By comparison, Apple’s combined capex and R&D budget was $26bn last year. NASA’s projected FY21 budget is under $23bn. See our August 18th, 2021 report: Tesla Capex + R&D to Surpass NASA Budget by FY27?.”

The analyst listed Tesla’s Dojo supercomputer chip as particularly impressive.

Of course, he couldn’t pass on commenting on Tesla Bot.

Jonas shared many’s opinions that the project lies between “next big thing” and “gimmick”:

“I’ve heard feedback from investors who say this was a gimmick, and others who say this could be the ‘next big thing.’ Just my view, but it’s probably a bit of both. The point being that Tesla’s areas of expertise in autonomy and robotics apply to scientific and commercial opportunities far beyond cars. At the same time, setting a team of scientists to perfect a humanoid robot, while not ostensibly related to transportation, could help lead to important discoveries relevant to the field of autonomy.”

Morgan Stanley didn’t change its overweight rating and $900 price target on Tesla’s stock.

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