Tesla nasdaq Tsla Stock Inches Up As Morgan Stanley Reiterates Overweight Rating

Tesla (NASDAQ: TSLA) Stock Inches Up as Morgan Stanley Reiterates Overweight Rating

Tesla (NASDAQ: TSLA) stock saw a modest rise in pre-market trading Monday as Morgan Stanley reaffirmed its Overweight rating ahead of the key shareholder vote.

Morgan Stanley has reiterated its Overweight rating on Tesla, maintaining a price target of $310.00. The investment firm underscored the significance of an upcoming shareholder vote on June 13th, which it believes could significantly influence Tesla’s long-term strategy. This vote is particularly crucial for CEO Elon Musk, as his ventures plan to invest in AI infrastructure in the coming years. Morgan Stanley pointed out that the cost of capital (the cost for Tesla to fund its operations and investments) is crucial for achieving AI supremacy. 

Implications for Tesla’s Stock

The firm indicated that the shareholder vote could result in notable fluctuations in Tesla’s stock price. An investor survey conducted by Morgan Stanley on May 29th gathered 109 responses in approximately 18 hours, revealing expectations about the stock’s movement following the vote. The survey suggested that the approval of Musk’s compensation package will likely increase the stock price, while non-approval might cause a decline. More respondents expect a substantial drop of over 6-10% if the package is not approved, compared to those expecting a significant rise upon approval.

These survey results indicate that the shareholder decision on Musk’s compensation could be pivotal for Tesla’s stock. Respondents expect approval to positively impact share value, while non-approval would provoke a more severe negative reaction. Although Morgan Stanley did not speculate on the vote’s outcome, it emphasized the potential for considerable volatility in Tesla’s shares around the event.

The attention now turns to the June 13th shareholder vote, which could determine Tesla’s future trajectory and role in the AI sector. Morgan Stanley’s analysis suggests that while the outcome is uncertain, the implications for Tesla’s stock are significant, with the market ready to respond to the shareholders’ decision.

Tesla (NASDAQ: TSLA) Stock Reaction

As of 08:09 a.m. (Eastern Time) Monday, TSLA stock traded at $178.45, marking a 0.21% increase compared to the previous trading session.