Tesla Stock Could Hit $400 Per Share Due to Its Dojo Supercomputer

Electric vehicle maker Tesla's stock jumped more than 5% in early morning trading on Monday after Morgan Stanley predicted its stock could jump 60% to $400 per share from $250 per share, fueled by its in-development Dojo supercomputer.

In a new report, analysts said Dojo could open up new addressable markets that "extend well beyond selling vehicles at a fixed price" for Tesla, per Reuters. Morgan Stanley added that Dojo could add as much as $500 billion to the automaker's market value by helping accelerate the adoption of Tesla's planned robotaxis and network services.

The automaker could also sell software and hardware used by Dojo to third parties. Analysts upgraded Tesla's stock to "overweight" from "equal-weight" and made it their "top pick," relating Ferrari, per Reuters.

"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," Morgan Stanley analysts, led by Adam Jonas, said Sunday.

While Tesla has traditionally relied on Nvidia's supercomputer, which is one of the most powerful in the world, the automaker began production on its in-house Dojo in July. The supercomputer, designed to handle massive amounts of data, will be used to train and improve Tesla's self-driving software and process the data its vehicles collect each day, according to the automaker's second-quarter earnings report.

Tesla CEO Elon Musk told investors in July the automaker is investing "well over" $1 billion on research and development costs involving Dojo. Musk posted his reaction to Morgan Stanley's report on his social media platform X, formerly named Twitter, writing, "Almost all of Tesla’s value long-term will be from AI & robots, both vehicle & humanoid."

Musk has been a staunch proponent of artificial intelligence, even founding his new startup in July, and has used the technology to develop Tesla's controversial Autopilot software. Through his Neuralink startup, which aims to implant brain chips into humans, Musk has said his technology will allow humans to achieve a state of "symbiosis" with AI and create "The Six Million Dollar Man.”