Morgan Stanley: Dojo supercomputer may increase Tesla's market value by US $600 billion, raising the target price to US $400.

CTOnews.com Sept. 11, Morgan Stanley analysts said in pre-market trading on Monday that Tesla's Dojo supercomputer could boost the popularity of self-driving taxis and software services, resulting in an increase in the electric car maker's market capitalization of nearly $600 billion (CTOnews.com Note: current about 4.42 trillion yuan), which pushed Tesla's share price up 6%.

Tesla, already the world's largest carmaker by market capitalization, began producing Dojo supercomputers in July to train artificial intelligence (AI) models of self-driving cars and plans to spend more than $1 billion on Dojo by next year.

In a report on Sunday, Morgan Stanley analysts led by Adam Jonas said Dojo could open up new sizeable markets that "don't just sell cars at fixed prices".

The Wall Street broker upgraded Tesla's stock from "flat" to "overweight" and made it their "first choice", replacing Ferrari's US-listed shares.

Morgan Stanley raised Tesla's 12-18-month target price by 60% to $400-the highest among Wall Street brokerages, which would give Tesla a market capitalization of about $1.39 trillion, according to LSEG. That is 76% higher than Tesla's market capitalization, based on Friday's closing price of $248.5, which is about $789 billion. Tesla's shares rose about 6% to $264in pre-market trading on Monday.

Jonas believes Dojo will bring the most value in software and services, and Morgan Stanley raised Tesla's revenue forecast for its web services business from $157 billion to $335 billion in 2040. Mr Jonas expects the division to account for more than 60 per cent of Tesla's core income by 2040, almost twice as much as in 2030.