TSLA Stock Hits Nearly 3-Week High: Nvidia Win Adds Muscle To ‘Physical AI’ Pivot Despite Optimus Delays

• Nvidia qualified Tesla’s battery systems for its DSX Ready AI factory program alongside Hitachi Energy and LG Energy Solution.
• Morningstar expects Tesla’s energy revenue to grow 30% annually from 2027 through 2031, versus 17% for automotive revenue.
• Oppenheimer maintained a ‘Perform’ rating, praising Tesla’s “Physical AI” and semiconductor ambitions, while warning of further Optimus delays.

Shares of Tesla, Inc. (TSLA) rose to their highest level in nearly three weeks on Monday after Nvidia (NVDA) qualified the EV maker’s battery systems for its new AI factory program, boosting its growth story beyond automobiles.

TSLA stock rose nearly 3% on Monday to end the session at $375.30, recording its best day in two weeks

Nvidia Taps Tesla For AI Factories

Nvidia named Tesla, Hitachi Energy and LG Energy Solution as the first qualified battery energy storage system providers under DSX Ready. The program helps AI factory builders identify power and cooling products that meet applicable Nvidia reference-design requirements.

AI data centers require enormous amounts of reliable electricity, making battery storage increasingly important as developers contend with grid limitations and fluctuating power demand.

Tesla’s qualification places its energy products within Nvidia’s expanding AI factory ecosystem. Although Nvidia cautioned that the designation does not replace site-level engineering or guarantee facility stability, it gives builders greater confidence when evaluating infrastructure products.

The announcement also spotlights a Tesla business that is growing much faster than its core automotive operations. Morningstar forecasts Tesla’s energy generation and storage revenue will grow by an average of 30% annually from 2027 through 2031, compared with 17% growth for automotive revenue.

It expects Tesla’s operating margin to expand from 8.2% in 2027 to 24.7% in 2031 as energy, software and other higher-margin businesses account for a larger share of sales.

Morningstar Calls Tesla A ‘Believe-Me Story’

Morningstar values Tesla at $450 per share, implying about a 20% upside from current levels. However, it assigns the stock a ‘3-star’ rating and a ‘Very High’ uncertainty rating since much of the valuation depends on businesses that are still under development or have yet to reach meaningful commercial scale.

The brokerage called Tesla a “believe-me story,” saying investors must believe in the company’s long-term robotaxi and humanoid-robot potential for the shares to appear undervalued. It expects Tesla to earn $1.95 per share this year, putting the stock at 192 times the projected earnings. It forecasts EPS rising to $3.22 in 2027, $5.90 in 2028, and $17.78 by 2031. The firm also projects average earnings growth of 25% from 2031 through 2035, which could make the current valuation attractive if Tesla delivers on its ambitions.

Oppenheimer Touts AI, Flags Optimus 

Meanwhile, Oppenheimer reiterated a ‘Perform’ rating on Tesla, saying Tesla is executing well as it attempts to become a fully integrated “Physical AI platform.” It called the company’s push into semiconductor manufacturing bold but strategically important as it could give Tesla greater control over a critical component of its AI systems, while reducing supply-chain and geopolitical risks.

Although Dojo did not significantly differentiate Tesla’s computing platform, Oppenheimer believes the expertise developed through the program could prove valuable as the company designs chips for multiple products. 

“We note ongoing progress on expanding compute capacity, impressive innovations on vehicle manufacturing with Cybercab and likely further delays on Optimus ramp,” Oppenheimer said. Morningstar also similarly cited the latest delay to the third generation of Optimus, along with the slower-than-expected robotaxi rollout, as key reasons Tesla shares have faced pressure.

How Do Retail Traders Feel About TSLA?

On Stocktwits, retail sentiment for TSLA improved to ‘bearish’ from ‘extremely bearish’ levels amid ‘extremely high’ message volume.

One user said, “$TSLA still not convinced that 390-400 will be a massive hurdle, but Tesla tends to recover around this time of the year and pump into year-end; let’s see”

Another bearish user said, “$TSLA buy and hold puts; they may try to keep this up today for the dump tomorrow”

So far this year, Tesla's stock has lagged its "Magnificent Seven" peers, making it the group's worst performer, down about 17%. 

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