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The most bullish Tesla analyst in the world thinks its future is self-driving cars you share with a stranger

Akin Oyedele   

The most bullish Tesla analyst in the world thinks its future is self-driving cars you share with a stranger

elon musk

Patrick Fallon/Reuters

Morgan Stanley's Adam Jonas thinks Tesla's future lies in an entirely new business model that could make the company's stock almost double.

In a note Monday, Jonas argues that the auto industry we have known for the last 100 years - of "human-driven, privately owned, internal-combustion vehicles" - is transforming, and Tesla is poised to "dominate" a new era for the automobile.

Basically, Jonas thinks that Tesla is best positioned to benefit from the proliferation of self-driving, electric cars that are shared by people going to different places.

So Uber, but with self-driving Teslas.

Jonas and his team raised their price target on the stock to $465 from $280, a 66% increase, and in premarket trading on Monday, the stock jumped 5% to trade near $257.

Here's Jonas:

Given the pace of technological development both within Tesla and at rival technology and mobility companies, we would be surprised if Tesla did not share formalized business plans on shared mobility within the next 12 to 18 months. This could potentially be followed by commercial introduction in 2018, shortly after the launch of the Model 3, which we think could form the backbone of a possible Tesla Mobility 1.0 urban transport PODS (Position on Demand Service) in 2018. We view this business opportunity as potentially additive to Tesla's existing model of selling human-driven cars to private owners and see potential for this model to conceivably more than triple the company's potential revenues by 2029. That is, selling miles in addition to selling cars.

So in short, Jonas' bullishness on Tesla envisions more or less an entirely new business model for the company, and for the auto industry at large.

"100% of Tesla's cars are electric, connected, and able to 'learn' through over-the-air firmware updates at any time," Jonas writes. "No other established automaker can claim this today. As we have written for sometime, we expect all car companies would eventually see nearly 100% of their revenues shift from the sale of human-driven/individually-owned cars to robot-driven/shared cars."

Welcome to the future.

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