One Wall Street Analyst Just Said Tesla Stock Could Be Worth $840: Time to Buy?

Morgan Stanley lifted Tesla's bull-case price target by 2.4% to $840, while retaining an equal-weight rating and a $400 base-case target versus shares near $357. The long-term upside thesis includes more than 80,000 autonomous Tesla Semi trucks by 2040, potentially generating over $17B in high-margin annual FSD revenue at up to $18,000 per truck per month. However, Semi production is still expected to be limited near term, FSD development for trucks is taking a backseat for six months, and Tesla's valuation at roughly 200x estimated 2026 earnings depends heavily on uncertain autonomy, adoption, and regulatory outcomes.

Analysis

The incremental bull-case change is not an earnings catalyst; it reinforces that TSLA’s valuation is effectively a long-dated option on autonomy rather than automotive execution. A commercial-trucking software opportunity is economically attractive only if Tesla can demonstrate safe, insurer-accepted driver-out operation at scale. Until then, Semi volume primarily raises capital-intensity and execution questions: manufacturing, charging corridors, fleet uptime guarantees, and residual-value support can consume cash well before any high-margin software revenue arrives.

The more investable near-term read-through is competitive. Autonomous freight is a narrower operating domain than consumer robotaxis, so credible commercial deployment could validate Tesla’s perception stack and lower the market’s assigned probability of broader FSD monetization. Conversely, a six-month prioritization delay creates room for incumbent autonomous-trucking platforms and OEM partners—Aurora Innovation (AUR), Volvo (VLVLY), Daimler Truck (DTG.DE), and PACCAR (PCAR)—to secure fleet relationships and freight-lane data, which are difficult to displace once embedded.

Over the next 1-3 months, TSLA will trade on FSD release quality, regulatory permissions, and evidence that fleet customers commit deposits rather than on distant unit forecasts. The key contrarian point is that the market may be double-counting autonomy across robotaxi, consumer FSD, Optimus, and trucking; they share AI investment but have distinct regulatory, liability, and operational bottlenecks. Falsification for a cautious view would be independently verified driver-out freight operations, binding fleet orders with pricing, and rising deferred-software revenue without a material increase in warranty or insurance reserves.

Over 6-18 months, charging utilization is the underappreciated upside: dense commercial charging can improve Tesla Energy/storage economics and potentially create a captive-services moat. But that upside requires corridor utilization well beyond early pilot fleets; absent this, Semi charging infrastructure risks becoming another low-return asset supporting an unproven vehicle program.

Key Decisions for Investors

• No directional TSLA add on the analyst-target revision. Maintain any core exposure hedged; reassess after the next two earnings calls based on FSD monetization, deferred revenue, capex guidance, and disclosed Semi deposits rather than aspirational 2040 revenue.
• For a 1-3 month relative-value expression, consider long PCAR / short TSLA in equal dollar exposure if TSLA rallies materially on autonomy headlines without verified commercial deployment. PCAR offers freight-cycle exposure with less autonomy-option premium; exit if Tesla announces binding fleet commitments plus a credible driver-out operating date.
• Establish an alert—not a position—on AUR around commercial launch milestones and carrier contracts. AUR is a more direct autonomous-freight probability trade, but financing dilution and launch slippage make it unsuitable until cash runway and OEM-funded deployment economics are confirmed.
• TSLA downside hedge: where implied volatility is not elevated, use 6-12 month put spreads funded by selling far-out calls above prior autonomy-driven peaks. The risk/reward improves if shares rerate toward bull-case narratives while automotive gross margin or free cash flow fails to inflect.
• Monitor PEP and other large private-fleet operators for order disclosures, route expansion, and charging commitments. A pilot-to-contract conversion would be more decision-useful than Tesla production targets and would be the earliest evidence of real fleet total-cost-of-ownership adoption.