Tesla (TSLA) Stock Rebounds, Morgan Stanley Speculates on CEO Musk's 'Masterplan'

Tesla (TSLA) stock is rallying today as Morgan Stanley posits that Elon Musk's 'masterplan' could involve an on-demand mobility service.
By Rachel Graf ,

NEW YORK (TheStreet) -- Shares of Tesla Motors (TSLA) - Get Report are rallying 0.63% to $226.19 in late-morning trading on Tuesday after Morgan Stanley speculated that CEO Elon Musk's "masterplan" could involve transitioning the electric car maker to a public transportation company.

"We believe the missing piece could be an on-demand mobility service that complements Tesla's skills in electric and autonomous vehicles," Morgan Stanley wrote in a note cited by Bloomberg.

"The auto industry is in the early metamorphosis from privately-owned model to a public transport utility," the firm added.

Tesla would be at an advantage given its relatively small exposure to "legacy systems" and advantages in "machine learning," Morgan Stanley said.

The firm estimates a 5,000 "mobility service" by 2018, according to Bloomberg.

Such a move could position Tesla to compete with ride-hailing apps such as Uber and Lyft.

Separately, TheStreet Ratings team rates the stock as a "sell" with a ratings score of D+.

Tesla Motors's weaknesses include its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

You can view the full analysis from the report here: TSLA

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author. 

Loading ...