AI Adds To Tesla’s Gains

Technology stocks, specifically those in the consumer discretionary sector, drove the market higher today. And leading the pack was electric vehicle maker Tesla.

The world’s most valuable automaker received a boost after Morgan Stanley’s Adam Jonas said the company’s Dojo supercomputer could drive $600 billion in market cap gains. 🤑

So, what is Dojo? It’s the supercomputer Tesla began producing in July to train artificial intelligence (AI) models for self-driving cars, and plans to invest over $1 billion per year into it.

Along with the note, Morgan Stanley upgraded the stock from equal-weight to overweight and raised its 12-18-month price target by 60% to $400, making it the highest on Wall Street.

The overall thesis is that this technology can help speed up Tesla’s push into robotaxis and software services, where most analysts expect its high-margin growth to come from eventually. However, these estimates from Morgan Stanley would require Dojo to do a lot of heavy lifting… 🏋️

For example, Adam Jonas raised his revenue estimate for Tesla’s network services business from $157 billion to $335 billion by 2040. That’s a 113% jump based primarily on the success of one project with about $1 billion in current funding. 😮

Many skeptics highlighted the leap of faith this forecast requires. They also pointed to Morgan Stanley’s lackluster coverage of Tesla in the past, with its analyst team seemingly behind the curve at every major inflection point.

However, $TSLA shares rode the optimism higher, rising 10% on the day and dragging the market higher with it. ⚡

AMC’s Taylor Swift Boost

Taylor Swift and her “Swifties” are having their time in the sun, bringing rays wherever they go. 🌞

While the NFL is looking to take advantage of Swift’s new potential romance, movie theatre chain AMC also wants to get in on the action, and so far, it appears to be working.

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Canon Pivots From Pics To Chips

The Japanese conglomerate is best known for its printers and cameras but hopes a business pivot will help get its stock price going again. 💡

Today, the company launched a tool that helps manufacture the most advanced semiconductors. Its “nanoimprint lithography” (NIL) system is the company’s attempt to compete with Dutch firm ASML, which leads the extreme ultraviolet (EUV) lithography machine industry. 

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Charlie Munger Passes At 99

The investing world is mourning the loss of investing sage Charlie Munger, who passed away today at age 99. 📰

Berkshire Hathaway released a statement that he peacefully died this morning at a California hospital. Warren Buffett, CEO of Berkshire Hathaway, said, “Berkshire Hathaway could not have been built to its present status without Charlie’s inspiration, wisdom, and participation.”

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McDonald’s Outlines Its Big Bet

McDonald’s has been meandering near all-time highs for most of the last year, bucking the trend of other restaurant chains pinched by inflation. Despite its strong performance, some investors are concerned about how the company plans to continue its run into the future. 🤔

Today, the company revealed its big plans at its investor day. 

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