NEW YORK (TheStreet) -- Tesla Motors (TSLA - Get Report) CEO Elon Musk has been compared to former Apple (AAPL - Get Report) CEO Steve Jobs in the press quite a bit, but this is the first time I can recall the comparison is coming from Wall Street.
In a research note to clients, Goldman Sachs analyst Patrick Archambault, who put a new $200 price target on shares, compares Musk, who's co-founded Tesla, PayPal, and SpaceX, to the legendary co-founder of Apple, as it relates to the Model S being like the iPhone. "Given the much longer 20-year product life cycle of a car relative to the three-year life cycle of a smartphone, we adjust the adoption patterns in our analysis to reflect this," Archambault said in the note. "By extrapolating the change in smartphone penetration rates within handsets and growth in iPhone sales relative to smartphones from 2003 through 2011, we are able to derive volume forecasts for both electric vehicles and Tesla units."
Archambault noted that while long-range electric vehicles will only have 4% of total global auto sales by 2025, Tesla will own 65.5% of that market, which equates to 2.7% of the light vehicle market, which would be good enough for 3.1 million units. That would imply a present value of $442 per share, nearly double what Tesla's shares are currently trading at. Archambault's forecast is similar to Morgan Stanley's Adam Jonas, who believes that Tesla will own 0.9% of the global car market by 2025. Jonas has a $320 price target on shares.
In Tesla's fourth-quarter, the company delivered 6,892 Model S units around the globe, and expects to deliver 35,000 vehicles in 2014, a far cry from 3.1 million vehicles.
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As the smartphone market really began to take off in 2003, relative to overall handset sales, Archambault is using a 2017-2025 time frame for electric cars as a percentage of the overall market. He thinks that electric cars are as revolutionary as smartphones were in 2003, with Tesla and its aforementioned Model S being the leader. The major difference however, is that cars have a much longer life frame than phones do, with smartphones averaging around three years in life, with cars potentially being multiples of that.
The iPhone was introduced in 2007 at Apple's WWDC conference in June, and since then has revolutionized the smartphone market, despite smartphones having been around well before that, with BlackBerry BBRY being the predominant name. In Archambault's case, he thinks both electric vehicles and Tesla take off at the same time, as Tesla dominates the electric vehicle market against other original equipment manufacturers (OEMs).