Morgan Stanley names Tesla 'top pick,' stock jumps

Tesla (TSLA) stock is gaining ground in Monday's trading session following a bullish call from Morgan Stanley. Analyst Adam Jonas has designated the electric vehicle maker as a top pick, citing Tesla's potential to generate positive cash flow after implementing cost-cutting and restructuring measures.

Catalyst anchors Madison Mills and Brian Sozzi analyze the factors behind Jonas's optimistic outlook, while discussing the health of the broader electric vehicle (EV) market.

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This post was written by Angel Smith

Video Transcript

All right, Tesla getting a bullish call from Morgan Stanley analyst, Adam Jonas calling the E maker a top pick in us autos overtaking Ford Jonas saying Tesla now has the opportunity to generate positive cash flow pointing to several actions which have helped lower the break even point.

Uh Adam Jones always, of course, uh Madie, a market mover on all things, Tesla, I would just point to, I just think we're getting better results out of other EV makers besides Tesla.

Uh When I talked to GM CFO after earnings last week, Paul Jacobson struck a very bullish note on how much I think their EV sales are up 40%.

They have a bunch of new models coming to the market that in many respects undercutting Tesla, that Tesla earnings report was not so great, so not to really pooh pooh this Adam Jonas call.

I mean, I think you're getting some uh some better results out of their competitors.

Yeah, he talked about some of the defense mechanisms of Tesla, right?

Things like cost cutting restructuring that that has helped to kind of pull off the downside from being too far to the downside, right?

But I think the big question for Tesla is how are they going to be offensive moving forward?

Are they going to be able to have that Robo Taxi?

Sounds like that announcement still getting pushed back.

Are they going to have a cheaper model moving forward?

We also don't know when that's going to happen.

Is the cyber truck really the catalyst that Elon Musk reported these things everywhere.

They're starting to pop up.

I mean, I've seen one in orange and black within the past.

I haven't seen any ones when I see them in Manhattan.

It's like the weirdest combination of aesthetics in the world.

Big dumb stupid pieces of metal.

I mean, they just really don't fit in a parking spot.

I mean, you always more of these start to hit the road, you're gonna have to re invent wild roads.

I mean, they're that big.

Well, it is, it is a good point.

But, you know, Kevin o'leary was on our show talking about how he said it's ugly and that's a good thing.

That's why I'm investing and he thinks it's gonna be, it's gonna be this thing that, you know, I mean, we're talking about it, right?

Because we're seeing it and sticks out, right.

I mean, and one key risk, I would just add this to this too if there's change in the White House, this $7500 tax credit to buy makers.

If that goes away.

If Trump wins the White House again.

And that's a removal of a major catalyst for the entire industry.

And I don't think that's pricing to Tesla shares at all.

And he said Musk said on the earnings call that that's going to be bad for his competitors, but worse for them, then it's going to be for Tesla.

Whether or not that's true.

I think it's the big question for them may find out.

Right.