Image source: Getty Images. The electric vehicle (EV) industry is witnessing increased competition, particularly in the crucial Chinese market. This poses a significant challenge for Tesla as it aims to differentiate itself from being just another automaker focused on low margins. Looking ahead to the next ten years, the potential key to enhancing profitability lies in the realm of self-driving cars. Analysts at McKinsey anticipate that autonomous driving could present a revenue opportunity ranging from $300 billion to $400 billion by the year 2035. Notably, Tesla holds a strategic advantage due to the extensive data gathered from its existing fleet of vehicles on the roads. Moreover, the company has unveiled a cutting-edge supercomputer named Dojo, specifically designed to analyze this data and support computer vision technology. It is predicted that in a decade, software-as-a-service (SaaS) related to autonomous driving could emerge as a significant component of Tesla’s business model, potentially boosting its profit margins.
The burning question arises: Should investors buy, sell, or hold Tesla stock? The upcoming decade is poised to witness significant transformations as breakthrough technologies like artificial intelligence, robotics, and self-driving cars transition into mainstream adoption. Shareholders of Tesla stand to benefit from having a forward-thinking leader like Elon Musk steering the company through these pivotal years. As Tesla gears up to establish its presence in lucrative software and service markets, investors are advised to carefully weigh their options. While Tesla undoubtedly commands a premium compared to its less innovative counterparts in the automotive industry, the current forward price-to-earnings (P/E) multiple of 119 appears to have already factored in substantial growth potential. Consequently, it may be prudent for investors to consider holding their positions until further clarity emerges.
Don’t miss out on seizing a potentially lucrative opportunity. If you’ve ever felt like you’ve missed out on investing in high-growth stocks, here’s your chance to make a strategic move. Periodically, our team of expert analysts issues a “Double Down” stock recommendation for companies poised for significant growth. By acting now, you could position yourself before these stocks take off. Past performance speaks volumes:
-Nvidia: a $1,000 investment at the time of our “Double Down” recommendation in 2009 would be worth $348,579 today!
-Apple: a $1,000 investment following our “Double Down” call in 2008 would now be valued at $46,554!
-Netflix: investing $1,000 after our “Double Down” advice in 2004 would have grown to $540,990 by now!
At present, we are alerting investors to three exceptional companies through our “Double Down” alerts, and this opportunity may not present itself again anytime soon.
Learn more »
*Stock Advisor returns as of February 21, 2025
Will Ebiefung has no position in any of the stocks mentioned. The Mot
